Gambling software developer Playtech today announced that it has received a regulatory nod to acquire leading technology company Consolidated Financial Holdings A/S (CFH) in a bid to boost its Financials division.
Founded in 2008, CFH is a technology company offering a number of digital products and services, including straight through processing brokerage. Thus, it provides its retail broker clients with top-tier tools aimed at assisting their operations. CFH’s brokerage platform currently services more than 400 customers and partners in over 80 countries, with some of those being BNP Paribas, Goldman Sachs, and Barclays.
The company generated revenue of $19.2 million and EBITDA of $5.7 million in the year ended December 31, 2015.
CFH is regulated by UK’s Financial Conduct Authority. Playtech today confirmed that it has received the necessary regulatory approval by the aforementioned body to proceed with the acquisition deal.
Under the announced terms, the online gambling software developer would purchase a 70% stake in CFH upon the transaction’s completion, which is set to take place at the end of November. The remaining 30% will remain subject to put and call options between the seller and the buyer and will be exercisable until 2019.
Playtech is to pay up to $120 million for CFH. The projected payment comprises an initial consideration of $43.4 million for the 70% stake the iGaming software developer is set to buy on November 30, 2016, and an additional consideration for the remaining 30%.
Playtech said that CFH’s management team will stay with the company after the transaction’s completion and in control of the remaining 30% stake.
Commenting on the acquisition, Ron Hoffman, CEO of Playtech’s Financials division, said that the deal will strengthen his company’s offering in the B2B financial trading market and will place it in an excellent position for further acquisitions in future. What is more, the addition of CFH to the Playtech Financials family is expected to help the division become one of the few businesses to offer both B2B and B2C brokerage platforms to international customers.
CFH Chief Executive and Founder Christian Frahm added that joining Platech will give his company access to excellent technology and opportunities to further establish itself as a leading B2B provider within the industry.
Playtech’s newly established Financials division provides CFDs broker and trading platforms in more than 25 languages and in 100 countries. Playtech said last week that its financial business has shown positive improvement signs in first-time depositors and active customers since the beginning of this year’s second half, although general performance has been affected by lower-than-expected market volatility.
Playtech’s Financials division generated revenue of €31.3 million during the the first half of 2016.
