Playtech confirmed on Monday it was in exclusive talks with a management consortium of Israeli companies about the possible sale of its financial trading arm, Finalto (previously known as TradeTech), for a cash offer of up to $200 million as the gambling software maker looks to simplify its business.
The UK company, one of the world’s biggest supplier of technology for online gaming operators, said the consortium was backed by Barinboim Group, Leumi Partners, The Phoenix Insurance Company and Menora Mivtachim Insurance Limited.
The filing with the London Stock Exchange revealed that the consortium is making a cash offer of up to $200 million, of which $170 million will be payable on completion, Finance Magnates reports. Additionally, $110 million of the capital required to run the division will be transferred with the business upon any sale.
Finalto is its financial unit formed with the acquisition of the three institutional (B2B) and retail (B2C) forex market entities. Playtech acquired FX liquidity provider CFH Group in late 2016 for $120 million and later spent another $150 million for Alpha Capital Markets, a London-based FX and CFDs market maker. These entities were then combined with Playtech’s Retail FX brokerage arm Markets.com.
The financial division remained one of its most profitable units last year as it brought in €87.3 million in revenue in the first half of 2020, 123 percent higher than the previous year.
The latest confirmation of the discussions came after the London-listed company revealed that it is expecting an adjusted EBITDA of at least €300 million for 2020 and now focusing to "simplify its business and dispose of non-core assets, and as such it has been continuing to evaluate all options for Finalto."