La Francaise des Jeux Acquires Kindred for $2.67 Billion

La Francaise des Jeux (FDJ), the operator of the French national lottery, acquired Kindred Group for about $2.67 billion. This transaction will be a huge milestone for both companies since it is a key step towards creating the biggest company in Europe when it comes to the online gambling industry.

FDJ’s international expansion:

The deal is almost closed, and Kindred is listed for sale in Stockholm. It was listed by Corvex Management from New York, led by Keith Meister.

FDJ will pay 27.95 billion Swedish kronor, and all shareholders will earn 130 Swedish kronor for each share they possess. 

FJD is a leading lottery and offline sports betting company in the whole of France. Apart from retail betting, the operator offers online sports betting and online gambling services. The company recently released the figures for the second half of 2023, and an increase of 6% was recorded, so the company had a profit of nearly €1.3 billion (US$1.3 billion).

The acquisition of Kindred will make a significant step towards the company’s international expansion, following the recent acquisition of Premier Lotteries Ireland. Thanks to the acquisition of Kindred, FDJ will be able to expand across key European markets such as the UK, France, Italy, the Netherlands, and Sweden, as well as Australia.

Kindred on a rough spot:

Kindred was founded in 1997, and since then its value has grown to more than $2.1 billion. The company operates nine gambling brands, such as Unibet, one of the leaders when it comes to sports betting, casino games, poker, and bingo releases, and Highrollers, the brand dedicated to players willing to make bigger bets.

The company recently decided to focus on the European market and leave North America in order to redirect funds to this key market. Kindred made a choice to pause its operations in the Netherlands, which led to a significant decrease in quarterly earnings. That led to a decrease in its stock price as well, since it decreased by 30% due to decreased revenue, so the acquisition is a way to increase the revenue and price again.

As WSJ reports, Corvex Management, the biggest company’s shareholder, decided to pursue the changes, and the majority of the board agreed with that. But Kindred isn’t the only European company looking for a solution – a lot of them experienced decreased stock prices and revenue. Just recently, Corvex disclosed more than a 4% stake in Entain, and Ricky Sandler, a CEO of Eminence Capital, joined the board in order to find the best solution.