Flutter has purchased an initial 51% stake in the #2 sports betting and gaming operator in Serbia
27th September 2023: Flutter is pleased to announce the acquisition of an initial 51% stake in MaxBet, Serbia's #2 omni-channel sports betting and gaming operator, for a cash consideration of €141m (£123m). Flutter also has the opportunity to acquire the remaining 49% in 2029.
MaxBet will provide Flutter with the platform to access fast-growing markets via a strong podium brand. This also creates an opportunity to accelerate growth and deliver a gold medal position for Flutter through expansion in the Balkans region by leveraging the benefits of the Flutter Edge.
MaxBet has built a strong omni-channel presence within its core Serbian market. Leveraging its growing retail presence, MaxBet has successfully capitalised on the fast-growing online market in Serbia which grew by 25% on a compound annual basis over the last 5 years. During LTM to June 2023, the business generated pro forma fully regulated revenue of €145m of which 44% is online, with Adjusted EBITDA of €32m.
This acquisition of MaxBet fully aligns with Flutter's key strategic criteria for value creative M&A:
- Provides an enhanced competitive position in fast growing, regulated markets:
- Serbia is an attractive, regulated market (2022: €700m) with relatively low online penetration of circa 35% and expected online compound annual growth to 2025 of approximately 15%.
- Market dynamics within the Balkans region typically create competitive moats for omni-channel operators due to cash-led economies as well as the importance of retail footprints.
- Adds a "local hero" brand to the Flutter portfolio:
- MaxBet is the #2 Serbian operator with an estimated 20% online share. It has over 400 retail outlets across four markets, a well-known local brand and 95k online average monthly players.
- A strong management team and 2,400 employees provide significant local market expertise. This capability underpins a strong execution on cross-sell and online expansion, despite low levels of marketing spend.
- Presents a clear opportunity to add the benefits of the Flutter Edge and deliver tangible revenue synergies through:
- Access to digital marketing expertise to enhance customer acquisition and retention. /Flutter's global proprietary pricing and risk management capabilities to deliver a differentiated sports betting product.
- Unparalleled gaming content and innovation for an improved gaming experience.
- Flutter technology to increase the scalability of MaxBet's platforms and enhance its product offering.
The transaction is subject to customary regulatory clearances and is expected to close in Q1 2024.
Peter Jackson, CEO at Flutter Entertainment, said: "I am excited to announce the addition of MaxBet to the Flutter portfolio. This acquisition continues our progress against the strategic priorities we have set for our International division; to buy and build podium positions in regulated markets. We believe MaxBet is an excellent opportunity to replicate the success we have achieved in markets like Georgia, India and Italy by acquiring a strong brand in a podium position, where we see a compelling opportunity to combine that extensive local expertise with the power of the Flutter Edge to accelerate and transform growth."
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About Flutter Entertainment Plc
Flutter is the world’s leading online sports betting and iGaming operator. Our ambition is to leverage our significant scale as well as our challenger mindset to change our industry for the better. By Changing the Game, we believe we can deliver long-term growth while promoting a positive, sustainable future for all our stakeholders. We are well-placed to do so through the distinctive, global competitive advantages of the Flutter Edge, which gives our brands access to group-wide benefits to stay ahead of the competition, as well as our clear vision for sustainability through our Positive Impact Plan.
The Group consists of a diverse portfolio of leading recreational brands and products with a broad global reach. We operate some of the world’s most innovative, diverse and distinctive online sports betting and iGaming brands such as FanDuel, Sky Betting & Gaming, Sportsbet, PokerStars, Paddy Power, Sisal, Tombola, Betfair, TVG, Junglee Games and Adjarabet. We are the industry leader with 10.2 million AMPs and £7.7 billion of revenue globally for fiscal 2022, and 12.3 million AMPs and £4.8 billion of revenue globally for the six months ended June 30, 2023.