Online sports betting and iGaming company Flutter Entertainment plc FLUT shares are trading marginally higher premarket Tuesday. The company disclosed its agreement to acquire Snaitech S.p.A. from a Playtech plc subsidiary at an enterprise price of €2.3 billion in cash.
Snaitech is one of Italy’s top online operators, holding a 9.9% share in 2023 and averaging 291,000 monthly players.
The acquisition aligns with Flutter’s strategy to strengthen its holding in international markets.
The transaction is expected to close by the second quarter of 2025 and should be immediately accretive to earnings per share.
Upon completion, Flutter anticipates claiming the strong spot in Italy with a ~30% online market share by integrating Snai with its existing business, including Sisal, which achieved 27% growth in AMPs and 17% revenue growth from the second quarter of 2022 to the second quarter of 2024, gaining 270 basis points in market share.
The deal is set to generate at least €70 million in cost synergies and additional revenue, and post-synergies, it matches the attractive multiple of the Sisal acquisition while exceeding Flutter’s return targets by year two.
Flutter expects operating cost synergies from integrating technology, content, and third-party procurement. These synergies should be realized within three years post-completion, with 10% in year one and 50% in year two. Also, the company anticipates capital expenditure synergies of €10 million.
This month, the company disclosed the acquisition of an initial 56% stake in NSX Group for around $350 million.
As of June 30, Flutter’s cash and cash equivalents stood at $3.2 billion.
Price Action: FLUT shares are up 0.29% at $225.00 premarket at the last check Tuesday.
Image via Shutterstock
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