Playtech Expands Portfolio By Purchasing Plus500Published June 2, 2015 by Lee R
Online Gaming software provider Playtech is moving into the finance market.
Merger and acquisition season is back, with Playtech's buyout of Plus500 appearing to kick off what may be an eventful summer.
Playtech Relieves Plus500
Teddy Sagi's Playtech has reached an agreement to pay 460 million pounds ($700 million) to acquire Plus500, providing necessary relief to the retail forex trading shop struggling to maintain compliance with current money laundering rules.
This is Playtech's second significant acquisition in its foray into online trading exchanges after an earlier acquisition of a majority stake in Trade FX.
With the deal, Playtech actually capitalizes on Plus500's struggles, in light of the announcement by Plus500 that some client accounts would be frozen while more rigorous background checks were conducted. This was as much a concession to the difficulty of meeting anti-laundering compliance regulations as a questioning of the integrity of Plus500 customers themselves.
This shook the values of Plus500, as well as necessitating financial relief so that Play500 could meet operation demands to remain compliant.
The result is that Playtech pays 400 pence per share for Plus500, resulting in the stocks spiking at 403 pence on Monday before leveling off to close at 374.5 pence, for a day's total rise of a more modest 1.2 percent.
Playtech is a sports betting and online casino games software provider now moving its technologies into the currency trading sector at a time in which all online gambling companies are going to be faced with operational adaptations to increasing taxes and more strict regulation.
Other Merger Activity
Another merger percolating is online gambling provider 888 Holdings making a run at an acquisition of Gibraltar online gambling provider Bwin.Party Digital Entertainment. Amaya, the world’s largest publicly-traded online gambling company, is reportedly teaming up to back the miniscule GVC Holdings to try to buy and ostensibly dissolve Bwin.Party. The deal is not done, but is reportedly in serious stages of discussion.