IGT Divests Lottomatica B2C To Gamesnet SPA

As IGT Plc has agreed to sell its Lottomatica B2C gaming and sports betting units to Gamenet SPA for €950 million, Italian gambling has woken up to a seismic M&A agreement.

IGT advises stakeholders that the technology company will refocus on its ‘Global Gaming segment on core competency as a B2B service provider’ in order to divest its Lottomatica ‘Scommesse’ (sports betting) and ‘Videolot Rete’ (B2C machines).

IGT governance, updating investors, stated that the transaction was recommended to ‘rebalance the business to allow the company to improve its potential profit margins and generate cash flow.

The deal values Lottomatica B2C units sold at an enterprise value of approximately EUR 1.1 billion, with assets producing gross adjusted EBITDA of approximately EUR 207 million in 2019.

In addition, the sale sees IGT retaining its ‘corporate commitment’ as proceeds from the deal will mostly be used to minimise the long-term debt of the company by $7.6 billion (as disclosed in FY-2019 accounts).

The NYSE gambling group will retain its heritage Lottomatica lottery division as its sole B2C trading entity should the deal be sanctioned.

Marco Sala, CEO of IGT said: “The transaction enables IGT to monetize its leadership positions in the Italian B2C gaming machine, sports betting, and digital spaces at an attractive multiple to comparable Italian transactions, providing us with enhanced financial flexibility,” said Marco Sala, CEO of IGT.

“Aligning with our recent reorganization, the favourable rebalancing of our business and geographic mix reframes and simplifies our priorities while improving the Company’s future profit margin, cash flow generation, and debt profile.”

Gamenet SPA, funded by the US private equity company Apollo Global, has agreed to pay an upfront cash settlement of EUR 725 million by 31 December and to pay the remaining EUR 125 million by 30 September 2022.

Gamenet continues to dominate Italian land-based gaming and retail sports betting through its aggressive M&A growth. Closing 2018 As Italy’s largest sportsbook network, Gamenet secured its spot, acquiring all GoldBet retail points for EUR 300 million.

As Gamenet’s current business portfolio accounts for +2,000 betting concessions and the operation of a retail betting network of +900 betting points, the negotiated transaction would possibly receive close scrutiny from Italy’s AGCM-competitions and market authority.

Gamenet operates 70 gaming halls and +38,000 gaming machines throughout Italy in an active land-based gambling portfolio.

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About Joe Kizlauskas

Joe is a seasoned iGaming copywriter and speaker who has been in the business since 2015. He's written more words on all elements of iGaming than he likes to remember, and he's contributed material to a number of well-known brands. Joe may be seen playing 5 a side, at the gym or playing games on his Playstation when he is not writing.