The Stars Group has become the world’s largest listed online gaming firm, after confirming its previously announced $4.7bn purchase of Sky Betting and Gaming (SBG), from CVC Capital Partners and Sky Plc.
Consideration for the purchase was a combination of cash and in the region of 37.9m newly issued common shares, the former of which was financed via cash on the balance sheet, proceeds from The Stars Group’s recent equity offering and newly issued debt.
Regarding the newly issued debt, the group details that it consists of $100 million from its revolving credit facility, $4,567m equivalent in new first lien term loans and $1,000 million in 7.0% unsecured senior notes due July 2026.
Rafi Ashkenazi, The Stars Group’s chief executive officer, commented: “This acquisition represents a pivotal moment in The Stars Group’s evolution. SBG’s mobile-focused sportsbook pairs well with our industry-leading poker offering to create two premier customer acquisition channels.
“We believe this combination along with our combined online casino offerings positions The Stars Group for continued growth in the evolving online gaming industry.
“This transaction creates the world’s largest publicly listed online gaming company and unites two iconic brand portfolios with strong technology platforms and teams. This significant scale also positions The Stars Group to both secure and expand upon its global footprint.”
Detailing the multitude of both operational and financial benefits that are expected to be felt as a results of the acquisition, The Stars Group indicated that it:
- Dramatically improves revenue diversity, creating a balanced spread across poker, casino and sportsbook with a broad geographic reach.
- Increases presence in locally regulated or taxed markets to approximately 75% of combined revenues.
- Develops sports betting as a second customer acquisition channel, complementing The Stars Group’s core offerings and creating an opportunity to cross-sell players across multiple verticals.
- Enhances The Stars Group’s products and technology through the addition of SBG’s innovative sportsbook and casino offerings and portfolio of popular mobile apps.