Entain will likely keep on acquiring gaming companies in Europe: Third Bridge Analyst

Entain will likely keep on acquiring gaming companies in Europe: Third Bridge Analyst

Entain Plc, a London Stock Exchange-listed international sports betting & gambling company, is widely expected to continue its ongoing buying spree in Europe. In a new report to clients, Third Bridge Analyst Lara Martinez stated that Entain could leverage deal-making in Central & Eastern Europe to diversify its revenue growth. Currently, the company is heavily dependent on the U.S. market, and its U.S. exposure is mainly derived from its 50 per cent stake in BetMGM.

For the last two years, the sports betting & gambling giant has been on a buying spree. It mainly acquired smaller gaming companies, such as Poland’s STS Group and Croatia-headquartered SuperSport Group. Martinez noted that the company could keep on expanding its presence in Europe through mergers & acquisitions (M&A).

In the newly published report, Martinez stated, “Entain has been rapidly expanding its presence in central and eastern Europe through M&A. According to our experts, Entain has the potential to further enhance its market share in Europe. However, at present, the majority of the company’s revenue and growth are associated with the US market.”

For improving its position in the fast-growing gaming industry, Eastern Europe is a special attraction for Entain PLC as a number of markets in this region aren’t as mature as Britain, Ireland, Italy and Germany. In other words, there is a great potential for growth. Moreover, some countries in Central and Eastern Europe don’t yet offer online betting, but that could change sooner than later, which would make such jurisdictions even more attractive to gaming companies.

Entain’s main focus is said to be on Eastern European markets like Croatia, Romania, Poland, the Czech Republic, and Slovakia. Markets like Bulgaria and Hungary are expected to implement online gaming regulations in the near future.

However, Entain’s recent buying spree came at a considerable cost. The Ladbrokes owner drew the ire of one of its largest investors – Rickey Sandler-led Eminence Capital, which criticised Entain’s management for issuing shares to fund STS Group’s $750 million acquisition. Sandler was quick to point out that the move resulted in dilution of current investors.

Headquartered in the Isle of Man, Entain has gaming licences in more than one and a half dozen regulated markets across the globe. With a workforce of more than 2,800 employees, it has presence in locations across North America, South America, Europe and Asia.

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