Gaming software developer Playtech plc announced earlier today that it is to place 29,050,000 ordinary shares, or a 9.9% stake in the company, in order to raise £250 million and fund the acquisition of online trading services provider Plus500 Ltd.
Earlier this month, the software developer said that it would purchase the FX broker for the amount of £460 million.
Playtech founder Teddy Sagi, who is holding a 33.6% stake in Playtech via Brickington Holdings Company, will take up 33.6% of the placing to maintain his present shareholding. Mr. Sagi also said that he is ready to aid the Plus500 purchase by contributing as much as $100 million of personal funds.
The share sale has become effective immediately with UBS and Canaccord Genuity appointed as joint bookrunners, and Shore Capital named lead manager.
Mor Weizer, Chief Executive Officer of Playtech, commented that his company has an “enviable M&A track” due to its pro-activity and financial flexibility. Thus, the gaming software developer has been able to act “from a position of strength” over the past several years.
Mr. Weizer further pointed out that the most recent fundraising, together with the new debt facilities, will strengthen the company’s capital structure and will make it possible for it to pursue both gaming and financial trading acquisitions, thus delivering long-term value for Playtech’s shareholders.
Apart from the share placement announcement, the gaming software developer also informed the media that it has bought more shares in Plus500 to increase its stake in the latter entity to 9.36%. Playtech had paid 400p per share, the exact same price it is offering for acquiring the entire company.
Founders and members of Plus500’s board, who represent a total of 35.65% of the broker’s issued ordinary share capital, approved Playtech’s takeover. Such an approval from a majority of shareholders is needed so as for the acquisition deal to be completed.
However, billionaire Crispin Odey, founder and owner of Odey Asset Management, who is also the largest shareholder in the company, did not seem too keen on Plus500 potentially being acquired by Playtech. Earlier this month, the businessman called the software developer’s offer an “opportunistic” one, as it aimed at exploiting the broker’s UK trading difficulties.
The potential purchase of Plus500 will not be Playtech’s first foray into online trading. In April, the company acquired online FX broker TradeFX for the amount of €208 million.
