Playtech linked with “break-up” sale if Aristocrat acquisition fails

According to Sky News, this could see separate disposals of Playtech’s business-to-business division and Italian consumer arm Snaitech, However, this would only be the case if the Aristocrat acquisition were not to go ahead.

Australian slot machine manufacturer Aristocrat in October 2021 brokered a deal to acquire Playtech for approximately £2.70bn (€3.23bn/$3.65bn).

Playtech previously stated that its directors recommended unanimously shareholders vote in favour of the Aristocrat offer, saying it would provide “certainty and liquidity”. 

However, last week Playtech said there was still uncertainty as to how some shareholders will vote on the Aristocrat bid at a meeting next week. The meeting is due to take place on 2 February, but Playtech said some material investors “have not to date engaged meaningfully about their views on the Aristocrat offer”.

Playtech said this means it is now approaching the court and general meetings “without a clear understanding” of whether these shareholders are supportive of the Aristocrat bid.

This has led to speculation in the media that if the Aristocrat acquisition does not go ahead, Playtech could instead break up its business and sell off its operations in parts.

Sky News reported that Playtech’s concerns are centred around a collection of Asia-based shareholders who own approximately a quarter of all Playtech stock. The acquisition would require the approval of 75% of shareholders in order to proceed.

Responding to the reports, Playtech did not state whether it was considering a break-up sale if the acquisition were to fail but did reiterate its recommendation that shareholders vote in favour of the Aristocrat offer.

“Whilr Playtech has made significant strategic and operational progress and is in a strong position for the future, Aristocrat’s proposal provides an attractive opportunity for shareholders to accelerate the delivery of Playtech’s longer-term value,” Playtech said.

Aristocrat’s chances of acquiring Playtech had seemingly improved last week after it was announced that JKO Play, a business controlled by former Formula 1 team owner Eddie Jordan and industry veteran Keith O’Loughlin, had withdrawn its interest in making an offer.

JKO Play emerged as a potential bidder for Playtech in November 2021 and was provided with due diligence. This led to Playtech postponing the shareholder meeting in relation to the Aristocrat offer to allow additional time to hold talks with JKO Play about a potential bid.

JKO Play was initially given until 5 January to submit a bid for Playtech, but this date was pushed back to the day of the rescheduled meeting (2 February). 

JKO Play had been required to clarify its position and confirm whether it would make a bid by 5pm on 26 January, but last week announced that it would not pursue its interest in making a bid and withdrew from the process.

It was initially hoped that a takeover deal would complete during the second quarter of 2022.

In December 2020, Playtech shareholders approved the sale of its financial trading division Finalto to Gopher Investments, a key step that was required for Aristocrat’s deal to take effect.

Gopher also previously also expressed an interest in acquiring Playtech, but withdrew from the running shortly after.