TIDM888
RNS Number : 1141A
888 Holdings plc
22 May 2023
22 May 2023
888 Holdings Plc
("888" or "the Group")
Sale of Latvia Business
Non-core asset sale for up to GBP22 million to increase focus on
Core and Growth markets
888 (LSE: 888), one of the world's leading betting and gaming
companies with internationally renowned brands including William
Hill, 888 and Mr Green, today announces that it has reached an
agreement to sell its Latvian business (the "Transaction"), to Paf
Consulting Abp. The total consideration is up to EUR28.25 million
(GBP24.6 million) for 100% of the business on a cash-free debt-free
basis, with an initial consideration of EUR24 million (GBP20.9
million) to be paid in cash upon completion of the Transaction, and
a further potential earn-out of up to EUR4.25 million (GBP3.7
million) payable in 2024 upon completion of the 2023 audited
financials. The Group owns 90% of the entity and the consideration
will be used for general corporate purposes.
The Latvian business operates with a local licence, using the
William Hill and Mr Green brands. The Group will provide a brand
licence to continue the usage of these brands within Latvia for a
limited period. The business operates largely as an independent
entity, with its own management team and operating on a separate
technology platform. As such the Transaction is expected to have no
impact on the ongoing operations and synergy program of the Group
and is consistent with the Group strategy to focus on core and
growth market plans.
In 2022 the Latvia business generated net revenue of GBP9.1
million and EBITDA of GBP2.5 million, and the value of the gross
assets subject to the transaction, as set out in the 31 December
2022 balance sheet, was approximately GBP9.3 million.
Completion of the Transaction is conditional upon, amongst other
items, the carve out of the Latvian subsidiary from the Group's
supplier contracts and incorporation of the Latvian subsidiary into
Paf's contracts, certain change of control consents and the payment
of a dividend by the Latvian subsidiary. Completion is currently
expected to occur in the coming weeks.
Lord Mendelsohn, Executive Chair of 888, commented:
"We continually review our asset base to ensure that we are only
holding assets that both contribute to our long-term strategy and
will maximise value for our shareholders. As a business, our
relatively limited exposure in the Baltic region means that the
region is not one of our core or growth markets where we prioritise
our investments.
The Latvian business is a high-quality, locally regulated
business, with an excellent team that has built a strong market
position. I would like to express my sincere thanks to the team for
their dedication during their time with the Group and I am highly
confident that under new ownership with Paf, the business will
continue to flourish."
Janis Tregers, co-founder and head of Latvia board,
commented:
"We launched in 2012 as 11.lv, and in 10 years, have built a
market-leading position in Latvia, with over 10% market share. In
2018, we sold 75% of the business to Mr Green at an enterprise
value of EUR3.7 million, and this transaction to sell the entire
business for a valuation of up to EUR28 million reflects the hard
work of our team across the business resulting in significant value
creation. Under the new ownership with Paf, I am confident that the
business will continue to go from strength to strength, delivering
great products and experiences for our customers."
Christer Fahlstedt, CEO of Paf, commented:
"We are thrilled to get the opportunity to continue to build on
a great Latvian success story. With a long-term perspective, we are
convinced that the Latvian market is moving in the direction of
increased player protection and thereby a great strategic fit for
Paf."
This announcement contains inside information. The disposal of
the Latvia business constitutes a class 2 transaction for the
purposes of the UK Listing Rules.
Tekkorp Capital acted as financial adviser to 888.
Enquiries and further information:
888 Holdings Plc +44(0) 800 029 3050
Lord Mendelsohn, Executive Chair
Yariv Dafna, Chief Financial Officer
Vaughan Lewis, Chief Strategy Officer
Investor Relations ir@888holdings.com
James Finney, Director of IR
Media 888@hudsonsandler.com
Hudson Sandler
Alex Brennan / Charlotte Cobb / Andy Richards +44(0) 207 796 4133
About 888 Holdings Plc:
888 Holdings plc (and together with its subsidiaries, "888" or
the "Group") is one of the world's leading betting and gaming
companies. The Group owns and operates internationally renowned
brands including William Hill, 888, and Mr Green. In addition, the
Group operates the SI Sportsbook and SI Casino brands in the US in
partnership with Authentic Brands Group.
Incorporated in Gibraltar, and headquartered and listed in
London, the Group operates from offices around the world and
employs over 11,000 people globally.
The Group's mission is to lead the gambling world in creating
the best betting and gaming experiences, bringing unrivalled
moments of excitement to people's day-to-day lives. It achieves
this by developing state-of-the-art technology and content-rich
products that provide fun, fair, and safe betting and gaming
entertainment to customers worldwide.
Find out more at:
http://corporate.888.com/
About Paf:
Paf is a Nordic gaming company founded on Åland in 1966 to
generate funds for the benefit of society. The founding
associations were The Red Cross, Save The Children, the public
health service and a children's welfare foundation.
Paf is an award-winning industry leader in responsible
gaming.
Paf (Ålands Penningautomatförening) is licensed and controlled
by the Government of Åland and holds online gambling licenses in
Sweden, Estonia, Latvia and Spain, as well as operating physical
gaming operations on more than 30 cruise ships in the Baltic and
the North Sea.
Paf has 330 employees representing 30 nationalities.
Find out more at:
https://aboutpaf.com/
Important Notices
This announcement may contain certain forward-looking
statements, beliefs or opinions, with respect to the financial
condition, results of operations and business of 888. These
statements, which contain the words "anticipate", "believe",
"intend", "estimate", "expect", "may", "will", "seek", "continue",
"aim", "target", "projected", "plan", "goal", "achieve", words of
similar meaning or other forward looking statements, reflect 888's
beliefs and expectations and are based on numerous assumptions
regarding 888's present and future business strategies and the
environment 888 will operate in and are subject to risks and
uncertainties that may cause actual results to differ materially.
No representation is made that any of these statements or forecasts
will come to pass or that any forecast results will be achieved.
Forward-looking statements involve inherent known and unknown
risks, uncertainties and contingencies because they relate to
events and depend on circumstances that may or may not occur in the
future and may cause the actual results, performance or
achievements of 888 to be materially different from those expressed
or implied by such forward looking statements. Many of these risks
and uncertainties relate to factors that are beyond 888's ability
to control or estimate precisely, such as future market conditions,
currency fluctuations, the behaviour of other market participants,
the actions of regulators and other factors such as 888's ability
to continue to obtain financing to meet its liquidity needs,
changes in the political, social and regulatory framework in which
888 operates or in economic or technological trends or conditions.
Past performance of 888 cannot be relied on as a guide to future
performance. As a result, you are cautioned not to place undue
reliance on such forward-looking statements. The list above is not
exhaustive and there are other factors that may cause 888's actual
results to differ materially from the forward-looking statements
contained in this announcement. Forward-looking statements speak
only as of their date and 888, its respective parent and subsidiary
undertakings, the subsidiary undertakings of such parent
undertakings, and any of such person's respective directors,
officers, employees, agents, affiliates or advisers expressly
disclaim any obligation to supplement, amend, update or revise any
of the forward-looking statements made herein, except where it
would be required to do so under applicable law. No statement in
this announcement is intended as a profit forecast or a profit
estimate and no statement in this announcement should be
interpreted to mean that the financial performance of 888 for the
current or future financial years would necessarily match or exceed
the historical published for 888.
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