Playtech to Sell Snaitech for €2.3B; Special Dividend Planned

Playtech plc has reached an agreement to sell Snaitech S.p.A. to Flutter Entertainment for €2.3 billion. A special dividend between €1.7 billion and €1.8 billion is planned for shareholders, indicating strong financial moves amid regulatory approvals expected by Q2 2025.

Date: 17-09-2024

AI Rating: 7

The recent report highlights significant strategic moves by Playtech plc (PTEC.L) which could positively impact its stock. The planned sale of Snaitech S.p.A. to Flutter Entertainment for an enterprise value of €2.3 billion represents a strong premium of 16.5% per share based on the undisturbed price. This suggests robust investor interest and confidence in Playtech's future, particularly as they pivot towards technology-led offerings in high-growth markets.

The report notes that Playtech acquired Snaitech in 2018 for €846 million. The increase in adjusted EBITDA from €139.3 million in 2017 to €256.1 million in 2023 indicates a substantial improvement in profitability, reflecting effective management and growth. This kind of financial performance supports a positive outlook for the company's share price.

Furthermore, Playtech’s intention to return €1.7 billion to €1.8 billion to shareholders via a special dividend demonstrates the company's commitment to returning cash to investors. Such dividends, especially when substantial, often bolster stock prices as they indicate financial health and shareholder confidence.

Post-transaction, Playtech also plans to repay €350 million of outstanding bonds due in March 2026, which can improve its balance sheet and reduce debt, further appealing to investors. Overall, these developments present a robust picture for Playtech's future trajectory in the stock market, particularly as it fortifies its position in B2B gambling markets.

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