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3 months ago
22
People walk by a banner outside of the New York Stock Exchange (NYSE) for the IPO of Flutter Entertainment, the parent company of FanDuel, on January 29, 2024 in New York City.
Spencer Platt | Getty Images
FanDuel parent Flutter Entertainment will spend $2.6 billion (2.3 billion euros) to acquire Italian gambling company Snaitech from Playtech, adding to a string of deals that aim to boost international growth.
In an email to CNBC, a Flutter spokesperson said the company is "hugely excited" to add another leading brand to its portfolio "in what is Europe's largest regulated market."
The deal comes as Flutter pushes to invest in the top companies in regulated markets around the world. Last week, the company made a major move into Brazil — which will have regulated gambling starting in January — when it bought a majority stake in NSX Group.
Italy is a particularly attractive market for Flutter, as it had about 21 billion euros in gross gaming revenue in 2023. But only about 21% of that came through online play.
Snai operates roughly 1,600 gambling shops and a variety of online poker and casino games. Flutter has been building up its presence in the country: it also acquired Italian lottery and gaming operator Sisal in 2022, and just reported record online market share in Italy in the second quarter.
Flutter said it expects the Snai acquisition will close by the second quarter of 2025 and will immediately boost earnings per share. Flutter said Snai had almost a 10% market share in Italy last year, and nearly 300,000 monthly active users.
The company's strong brand awareness will likely be an advantage given Italy's tough restriction on advertising and marketing.
The British gaming company's acquisition is only its latest to expand its international presence. Flutter last week said it is taking a 56% stake in NSX Group for about $350 million and its existing Betfair Brazil business.
NSX operates Betnacional and other brands, and holds the number four position in the Brazilian market.
Flutter expects "an exciting runway of future growth" through the agreement, CEO Peter Jackson said in a statement when it was announced.
The new business will be renamed Flutter Brazil, and the deal is expected to close in the second quarter of 2025.
A gambling "gray market" currently exists in Brazil, where players have unfettered access to online betting platforms without formal regulation. That will change Jan. 1, when new regulations and licensed gambling go into effect.
Brazil had nearly $3 billion in gross gaming revenue in 2023, and the market has grown roughly 38% since 2018, according to Flutter.
Flutter will face a lot of competition in the market.
In Brazil, 113 companies have applied for licenses in a preferred application window. MGM Resorts has applied in partnership with Latin America's biggest media group, Grupo Globo. Global gaming powerhouse Bet365 is already operating in Brazil and expected to be a formidable competitor.
Massachusetts-based DraftKings, FanDuel's main competitor in the U.S., remains focused on opportunities within its home market.
