International operators target re-regulated Sweden

The upcoming re-regulation of the Swedish iGaming market has led to a flurry of activity from international operators exploring the opportunity to secure a listing on the Stockholm Stock Exchange, according to Adam Kostyal, senior vice-president at Nasdaq, which operates the market.

As reported last week by iGamingBusiness.com, Sweden’s gaming regulator has urged operators to apply as early as possible when the licensing window opens on August 1 ahead of the market opening up in January 2019.

Kostyal told iGamingBusiness.com at iGB Live! in Amsterdam that Nasdaq Stockholm is on track to add about 100 new listings this year, market permitting, with some 10 to 15 per cent of those in the pipeline being non-Nordic.

Of those companies that are from outside the region, about 30 per cent are companies that are “driven by the gambling sector”, Kostyal said.

“We’re seeing more and more international interest,” he added. “Whether this develops or not, it’s looking very positive.”

The interest in Nasdaq Stockholm as a hub of investment activity in the sector has been partly driven by the “cluster of gambling companies, analysts, investors and advisers” who view the exchange with increasing interest, Kostyal said.

Explaining that about 78 per cent of the sector’s market capitalisation is listed in either Sweden or the UK, Kostyal added that Nasdaq Stockholm is home to three companies in the industry that can boast valuations in excess of €1bn – Evolution Gaming, Kindred and NetEnt.

Nasdaq Stockholm’s growth market, First North, has an average market capitalisation of €58m for a gambling industry-related company. Moreover, more companies from the sector have opted to list on First North than the London Stock Exchange’s Alternative Investment Market over the past three years, bucking a previous trend.

“The general perception has been that London is the hub, but that is being questioned more and more,” Kostyal said.

“Brexit is going to be a disruptor and we have a cluster of companies creating a lot of attention in terms of Stockholm being a natural hub.”

Stockholm is the second-largest of Nasdaq’s 29 exchanges worldwide, behind the US.

Kostyal added that it is too early to discover what the implications will be for the global investment landscape following the Supreme Court’s decision to overturn the Professional and Amateur Sports Protection Act (PASPA) in May.

“We’re talking to more and more companies that are considering a possible future dual listing in the US when the time is right,” he said.

“We’re happy to enter into dialogue with companies about opportunities and potential restrictions, but it’s very early days.”