Playtech terminates USD 700M agreement for Plus500

The move comes more than a month after Playtech said it would challenge the Irish central bank's (CBI) decision to oppose its $105 million deal for currency trading platform Ava Trade Ltd. But it did not say what the issues were.

Playtech, which has been on an acquisition spree this year, said on Monday it was terminating the agreement to buy Plus500 as the deal was unlikely to obtain approval from the UK's Financial Conduct Authority by December end.

Shares in Playtech, founded by Israeli billionaire Teddy Sagi, fell as much as 12.3 percent in early trading, while those of Plus500 sank as much as 22 percent.

Playtech had announced four acquisitions since the beginning of the year worth about $1.3 billion.

The company had agreed to buy Plus500 in June to expand its online trading platform.

Playtech said that following an update from the FCA on Friday, it was of the view that the steps being proposed to address certain concerns would not sufficiently satisfy the regulator to enable it to obtain approval by Dec. 31.

Playtech did not mention what concerns were raised by the FCA.

The company said it would not incur any financial penalties with respect to the termination and that it had no immediate plans related to its existing 9.9 percent holding in Plus500.

However, the termination raises concerns about Playtech's Ava Trade deal. The CBI's opposition to the deal had triggered a termination right for Ava Trade's sellers.

Playtech said on Monday that although the sellers had not yet exercised this right, the termination of the Plus500 deal increased the risk that they may do so.

Playtech shares were down 8.6 percent at 778 pence at 0950 GMT. Plus500 shares recovered most of their early losses to trade about 2.5 percent lower at 349.50 pence.