Flutter Entertainment plc (FLUT), a prominent player in the online sports betting and iGaming industry, is making waves in the Italian market. The company announced its agreement to acquire Snaitech S.p.A. from a Playtech plc subsidiary for a hefty €2.3 billion in cash. This strategic move signals Flutter’s ambition to solidify its presence in international markets.
Snaitech, a prominent name in Italian online gaming, holds a 9.9% market share and boasts an average of 291,000 monthly players. The acquisition is anticipated to catapult Flutter to a commanding position in Italy, with an estimated market share of around 30% upon integration with its existing operations, including Sisal. Sisal has been experiencing impressive growth, with a 27% increase in AMPs and a 17% rise in revenue between the second quarter of 2022 and the second quarter of 2024.
The deal promises significant financial benefits for Flutter. It is expected to be immediately accretive to earnings per share and generate at least €70 million in cost synergies and additional revenue. Furthermore, the deal aligns with Flutter’s previous acquisitions, offering an attractive multiple comparable to the Sisal acquisition while exceeding its return targets within two years.
Flutter anticipates substantial operational cost synergies through the integration of technology, content, and third-party procurement. These synergies are projected to be realized within three years post-completion, with 10% in the first year and 50% in the second. The company also anticipates capital expenditure synergies of €10 million.
This acquisition comes on the heels of Flutter’s recent purchase of a 56% stake in NSX Group for approximately $350 million. As of June 30, Flutter boasts a healthy cash position of $3.2 billion, providing financial flexibility for its ambitious growth strategy.
The news of the acquisition has been met with positive sentiment in the market. FLUT shares are trading up 0.29% at $225.00 premarket at the time of writing. This deal highlights Flutter’s strategic focus on expanding its global presence, particularly in key markets like Italy. It remains to be seen how the integration of Snaitech will play out and the impact it will have on the competitive landscape in the Italian iGaming market.
