French gaming company La Francaise des Jeux (FDJ) has initiated a takeover offer to acquire Swedish online gaming peer Kindred Group in a move poised to create the second-largest operator in Europe’s gaming sector.
FDJ has proposed a bid of 130 Swedish crowns ($12.43) per share for Kindred, reflecting an enterprise value of 2.6 billion euros ($2.83 billion) and offering a premium of 24% over Kindred Group’s closing price on January 19.
Kindred Group’s shares experienced an approximate 17% surge to 122.6 crowns, while FDJ’s stock saw a 3.9% increase in early trading. FDJ, known for offering lottery scratch cards in France and with the French state holding a 20% stake, expressed confidence that the acquisition of Kindred Group would enhance its earnings, resulting in an accretion of over 10% in its dividend per share.
In exploring various strategic alternatives, Kindred Group, including a potential merger or sale, noted that FDJ’s offer was the “most attractive outcome for shareholders.” The board unanimously recommended the proposed offer, recognizing Kindred’s long-term growth prospects amid associated risks and uncertainties.
The offer from FDJ marks a significant development in the gaming industry, signaling ongoing consolidation efforts to strengthen market positions. The combined entity is expected to leverage synergies, contributing to enhanced financial performance and shareholder dividends.
The move came when Kindred Group attracted interest from multiple parties during its strategic review, and FDJ’s bid emerged as the most compelling option. The acquisition, subject to regulatory approvals and customary closing conditions, is poised to reshape the European gaming sector, providing both companies with new opportunities for growth and collaboration.
