Playtech plc
("Playtech" or the "Company")
Update on the acquisitions of Plus500 Ltd. and Ava Trade Ltd.
Further to the Company's recent announcements, the Board announces an update on its proposed acquisitions of Plus500 Ltd. ("Plus500") and Ava Trade Ltd. ("Ava Trade").
Update on the acquisition of Plus500
Whilst regulatory approval for the acquisition of Plus500 has already been received from the Cyprus Securities Exchange Commission, the Company has been in active dialogue with the Financial Conduct Authority ("FCA") in relation to its proposed acquisition of Plus500, including in relation to certain concerns raised by the FCA which the Company considered could be resolved to the satisfaction of the FCA prior to 31 December 2015, being the effective long-stop date for the transaction to complete.
However, following an update from the FCA late in the afternoon of Friday 20 November 2015 and having considered its position over the weekend, the Board of Playtech is now of the view that the steps being proposed to address these concerns will not sufficiently satisfy the FCA to enable Playtech to obtain the FCA's approval by 31 December 2015, and is therefore withdrawing its change of control application to the FCA.
Under the terms of the merger agreement with Plus500, Plus500 would have the right to terminate such agreement if completion does not occur by 31 December 2015. The Company has discussed with Plus500 the consequences of the recent developments with the FCA and has agreed to the termination of the merger agreement. Accordingly, the acquisition of Plus500 will not be proceeding as planned.
Playtech will not incur any financial penalties with respect to the termination of the acquisition of Plus500. Playtech has no immediate plans with respect to its existing 9.9% holding in Plus500.
Update on the acquisition of Ava Trade
The Central Bank of Ireland's ("CBI") opposition to the acquisition of Ava Trade, which Playtech announced it was appealing on 6 October 2015, triggered a termination right for the sellers of Ava Trade. Although the sellers have not to date exercised this right, Playtech believes that the termination of the merger agreement with Plus500 increases the risk that the Ava Trade sellers may do so.
Should the acquisition of Ava Trade not proceed, Playtech will not incur any financial penalties other than forfeiting the previously announced $5m non-refundable deposit already paid by Playtech on the signing of the acquisition.
Playtech continues to appeal the CBI's decision to oppose its application to acquire Ava Trade.
Outlook
Playtech's Gaming division continues to enjoy double-digit underlying growth with a strong pipeline of opportunities providing confidence in maintaining momentum.
Playtech remains committed to growing its Financials division, both through driving organic growth and through acquisition, although this vertical is unlikely to have the scale of contribution to the group in the near to medium term that had previously been anticipated as a result of the acquisition of Plus500 not completing.
Playtech is in the process of evaluating its options with regards to its significant cash balances following the termination of the acquisition of Plus500, taking into account the availability of suitable value-enhancing acquisitions across the business.
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For further information contact:
Playtech plc +44 (0)20 3772 2500
Mor Weizer, Chief Executive Officer
Ron Hoffman, Chief Financial Officer
c/o Bell Pottinger
Andrew Smith, Head of Investor Relations +44 (0)1624 645954
Bell Pottinger +44 (0)20 3772 2500
David Rydell / Olly Scott / David Bass /
James Newman
About Playtech
Playtech is a market leader in the gambling and financial trading industries. Founded in 1999 and listed on the Main Market of the London Stock Exchange, Playtech has more than 5,000 employees in 14 countries.
Playtech is the gambling industry's leading software and services supplier with more than 120 licensees globally, including many of the world's leading regulated online, retail and mobile operators, land-based casino groups, government sponsored entities such as lotteries, and new entrants opening operations in newly-regulated markets. Its business intelligence-driven gambling software offering includes casino, live casino, bingo, poker and sports betting.
It is the pioneer of omni-channel gambling which, through Playtech ONE, offers operators and their customers, a seamless, anytime, anywhere experience across any product, any channel (online, mobile, retail) and any device using a single account and single wallet. It provides marketing expertise, sophisticated CRM solutions and other services for operators seeking a full turnkey solution.
Playtech's Financials division, run through subsidiary Markets Limited (formerly called TradeFX), is an established and growing online CFDs and binary options broker and trading platform provider, operating a number of brands including markets.com. Its B2C focused offering is available in more than 100 countries and in more than 25 languages and is licensed and regulated in the EU and South Africa.
www.playtech.com
