By Pushkala Aripaka
-Britain’s Playtech said on Wednesday it would sell its financial trading unit to Gopher Investments, the company’s second-biggest shareholder, for $250 million, after investors had rejected a rival deal agreed to earlier this year.
The cash deal for Finalto has been unanimously backed by the gambling software maker’s board and ends a months-long battle for Gopher with Playtech and a consortium led by Israeli private equity firm Barinboim over control of the unit.
“We are very pleased to have successfully reached an agreement with Gopher … This transaction delivers on our strategy to simplify the group to focus on the high-growth B2B and B2C gambling markets,” said Playtech Chief Executive Mor Weizer.
Playtech said it would either retain proceeds, worth over $130 million, from the sale and cut its debt if there was clarity on the current pandemic-hit business environment, or return capital as feasible, depending on when it receives funds.
Hong Kong-based Gopher, which has a near 5% stake in Playtech, said the deal is expected to be completed in the first half of 2022.
London-listed Playtech also said Gopher would pay an $8.8 million break-up fee to the Barinboim consortium, as promised by the shareholder in July on the condition that Playtech accepted its $250 million deal over Barinboim’s $210 million offer.
Playtech was founded more than two decades ago by Israeli billionaire Teddy Sagi. While Finalto is not a core asset, it had been rapidly growing, and market volatility brought on by the pandemic also made it a lucrative target for buyers.
For the first half of fiscal 2021, the unit posted an adjusted core loss of $600,000, Playtech said.
Shares of the company, which have gained about 15% in value this year, ended 3.5% higher on Wednesday at 459.8 pence before the agreement was disclosed.