SkyBet sold

[jetset]

SKY SELLS BETTING BUSINESS TO PRIVATE EQUITY FIRM

CVC Partners pays up to GBP 800 million for asset.

According to reports in Thursday's Telegraph newspaper in the UK, major broadcast company Sky has sold a majority stake in its betting business SkyBet to CVC Capital Partners, a British private equity firm, for up to GBP 800 million.

Sky's decision is believed to be motivated by a desire to focus on core pay-TV operations.

The Telegraph report quotes the broadcaster as saying that the sale will "crystallise value" and enable Sky to focus on the "significant opportunity for growth in pay TV across the five markets in which it operates."

Last month the company dropped "British" and "Broadcasting" and adopted Sky as its official name after it completed the GBP 7 billion takeover of Sky Deutschland and Sky Italia.

The parent Sky company will retain a 20 percent share in SkyBet, along with ongoing broad representation as well as a long-term brand licence agreement.

Under the terms of the Sky Bet deal, Sky will receive GBP 600 million in cash first and a further GBP 120 million at a later stage.

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[Casino2014man]

Nooooooooooooo

This is my favourite casino, I do not want any changes. They payout instantly for me and I have awesome luck there..

 

[Zabier]

Once again, it shows the ridiculous sums of money involved. Hopefully, if a company is willing to spend that much purchasing a company then it has a very solid business plan. Fingers crossed it improves the products for the better.

 

[vinylweatherman]

Once again, it shows the ridiculous sums of money involved. Hopefully, if a company is willing to spend that much purchasing a company then it has a very solid business plan. Fingers crossed it improves the products for the better.

The "improvement" will be aimed at the shareholders, not the customers. We also have yet another casino bearing a household brand name that doesn't actually belong to that brand. Sky only have a 20% stake, so no longer call the shots, but simply receive 20% of the distributed profit.

Instead of being run by a public listed company, the casino will now be run by a "private equity" group who's accounts will not be as open to scrutiny as Sky's are.

Changes, if they are going to happen, are likely to be held off till after Christmas. Players should keep an eye open for changes that are done to increase profits, and I suspect that one of the first will be the loss of fast payments to something more in line with what players put up with elsewhere. Bonus rules may also be tightened so that the headline giveaways might not have to be reduced, but their ultimate value to players will be.

 

[Casino2014man]

If they start any of that crap my account will be closed, just like Ladbrokes.

Have to say it will royally pee me off.

I had to shift from Ladbrokes after years of great games, luck and experiences because they ruined it. If Sky do the same I will not be very happy..

I know there are other casinos but I have awful luck at Guts et al for some reason.

 

[conker]

Private equity firm and gambling - sounds like a marriage made in hell. Expect to be inundated with reactivation requests and a constant barrage of offers as they look to squeeze every last penny out of their players. Well, they have to get £800 million back somehow...

 

[jetset]

My understanding is that the present management team and staff will remain in place with Richard Flint continuing as CEO (not surprising as investment firms hardly have the requisite expertise)

If the board at CWC is smart they'll look after a good team that has built a pretty solid enterprise, and keep interference to a minimum in an operational sense.

 

[jasonuk]

CVC were the ones who tried - and failed - to acquire Betfair last year.

A couple of the articles mention that the Sky Bet business had revenues of £182m in the year to 30 June 2014 with pre-tax profits of £50m, so the valuation is 16 times pre-tax profit. That seems like a pretty chunky multiple...

 

[Zabier]

If, and this is a very sceptical if, this becomes a successful transition then will it signal for more private equity firms to get involved? I feel like this has the potential to butcher the slots industry in a worst case scenario.