Flutter Entertainment Plc announced Thursday afternoon that it plans to approve a private placement made available to ‘institutional investors’ of 8 million company shares.
The expanded FTSE100 gambling group aims to raise another £850 million in working capital, strengthening its liquidity to take advantage of a disrupted marketplace’s short and long term opportunities.
Flutter governance, confirming the placement, outlines four main areas where the company intends to accelerate its growth.
Flutter stresses the rapid expansion of its US footprint as its top corporate goal, through which the organisation will push to substantially advance its joint venture relationship with FOX Sports in all controlled markets in the United States.
As part of the investment, US joint venture partner FOX Corporation has committed to securing an rise in their Flutter Plc equity.
Fox Corporation CEO Lachlan Murdoch said: “FOX is bullish about the opportunities in the digital sports wagering market. FOX Bet has shown strong growth since launching last fall, and we look forward to continuing that success with our partner, Flutter. FOX’s investment in Flutter underscores our confidence in Flutter’s business and its management’s ability to continue to drive leadership in the U.S. market.”
At the operational level, Flutter details that the placement will help the company secure co-synergies with The Stars Group Inc. on faster enlargement. The FTSE firm seeks to build its competitive edge in all types of online gambling products (poker, casino, sports betting and wagering on Exchange).
Flutter points out that the £850 million investment provides ‘secure early finance cost savings’ for an expanded business, where governance seeks to deleverage the company’s balance sheet faster than expected reducing long-term interest payments.
Finally, Flutter adds that a stronger balance sheet will help the company navigate and capitalise on COVID-19 opportunities in relation to unknowns about the timing of sport returns, market regulations and economic uncertainties.
“The group believes that the current operating environment is likely to result in longer-term changes to the sector landscape which will lead to further opportunities. The placing will better position the group to move quickly to capitalise on such opportunities should they arise, accelerating its four-pillar strategy and consolidating its market leadership positions,” Flutter explained.
Flutter delivered its Q2 trading statement earlier Thursday afternoon, in which the expanded business reported a 10 percent rise in group sales, despite being forced to close its entire UK retail betting presence