OPAP's participation in Stoiximan amounts to 84,49% after the agreement for the acquisition of an additional 15,48% of the company's shares.
The Stoiximan group has online gambling activities in Greece and Cyprus and OPAP directly controls approximately 48,75% of the company and the remaining 36,75% through the parent TCB Holdings. Through TCB Holdings, OPAP also has a stake in the online gambling market in Portugal, Romania and Germany.
In detail, the announcement
Following the initial announcement of OPAP SA from September 24, 2018. (hereinafter "OPAP"), which described the investment of 100% subsidiary of OPAP Investment (hereinafter "OPAPINV"), in the Stoiximan Group, in which OPAPINV currently holds a 36,75% stake through TCB Holdings Ltd (hereinafter "TCB "), As well as the subsequent relevant updates, OPAP announces that:
(1) Following the approval of the Greek Competition Commission and the recently published decision (14 April 2020) of the Commission for the Protection of Competition of the Republic of Cyprus, OPAPINV may proceed with the acquisition already agreed by TCB, with a direct 51% stake in Greek and Cypriot activities of the Stoiximan Group (hereinafter referred to as "SMGC"), currently conducted by GML Interactive Ltd.
(2) A new agreement has been reached, which - subject to the necessary approvals from the market and competition authorities - provides: (i) an additional investment by OPAPINV, in the form of an additional 15,48% share acquisition indirectly at SMGC. This investment, together with the aforementioned OPAPINV's stake in SMGC, will combined to increase OPAPINV's total stake in SMGC to 84,49%. (ii) The subsequent acquisition of sole control of SMGC by OPAPINV. SMGC will continue to operate under the name "Stoiximan" through a separate legal entity.
OPAP will maintain its existing 36,75% stake in TCB, which will continue to offer online betting and other gambling services outside Greece and Cyprus (currently present in Portugal, Romania and Germany), under the name "Betano", through its subsidiaries.
Price
The total net price for all the above transactions, which is planned to be paid during 2020, amounts to 163,4 million euros, in addition to the corresponding amount of net cash available. Also, subject to the fulfillment of the criteria for financial performance set for SMGC, sellers will be entitled to an additional percentage payment on future earnings (earnout), which will be calculated as a multiple of the difference in earnings before interest, taxes and depreciation (EBITDA) for years 2020 and 2021.
Corporate Governance and Administration
SMGC will continue to operate independently of the online activities of OPAP SA. The existing SMGC management team will continue to lead SMGC's day-to-day operations. OPAPINV will also appoint its representatives to the Board of Directors of the legal entity that will conduct the activities of SMGC and, after the completion of the acquisition of sole control over SMGC, will have the control of the Board.
Stoiximan Group
In 2019, the Stoiximan Group, under the parent company TCB, recorded revenues of 245,2 million euros and profits before interest and taxes of 36,4 million euros. SMGC 's activities recorded revenues of 196,7 million euros, which correspond to 80% of the group' s total revenues. The Stoiximan Group offers online gambling services in Greece and Cyprus, under the Stoiximan brand, as well as in Portugal, Romania and Germany, under the Betano brand, at the moment.
Comments from management executives
Kamil Ziegler, President of OPAP, commented: "The Greek online market is evolving and is gradually entering a new era, in which its fully regulated and supervised operation is foreseen, after the adoption of relevant legislation a few months ago. In this context, our strategic investment in the Stoiximan Group - together with the development of our own online activities - is an important move for OPAP, as it ensures that we are properly positioned to take advantage of the opportunities offered by the growing online market. For my part, I would like to confirm that OPAP remains fully committed to the implementation of an integrated business strategy, which aims to create sustainable growth and long-term value for our shareholders, the company itself, our agents and partners, as well as our people. "
Damian Cope, CEO of OPAP, commented: "The development of OPAP's online presence has been a key element of Vision 2020 from the beginning. For the last two years, we have been consistently implementing our strategy - the development of our online activities and investment in the leading Greek internet provider, the Stoiximan Group. During this time, both activities developed rapidly, although they started from very different bases. We are, therefore, pleased to announce today that we can not only complete the investment, which we have already announced, but also that we have reached an agreement with Stoiximan to further increase OPAP's participation in their Greek and Cypriot activities. Under the leadership of the company's co-founder George Daskalakis, the Stoiximan team continues to achieve impressive growth in all markets in which it operates. That is why I am convinced that this cooperation confirms that solid foundations have been laid, which will contribute to the internet activities to be an even greater part of the total profitability of OPAP in the future ".
George Daskalakis, CEO of Stoiximan, said: "Since the initial investment of OPAP 14 months ago, both Stoiximan and Betano have grown impressively. This is due to the strategic plan that was implemented consistently and professionally by the unique team of 700 and more dedicated associates, of whom I have the honor to lead. Today, OPAP's decision to strengthen its investment in Stoiximan essentially fuels the company's prospects for the future, but above all it is a strong vote of confidence in the way we do our job. We start this next day of creation with the same commitment and the same determination to work hard to further consolidate Stoiximan as a leading provider in the Greek online market, while strengthening Betano's growth in the international markets we choose to operate. "
source: mononews.gr