Gopher Investments to Enter Playtech Bidding War With $4bn+ Counteroffer

  • Playtech confirmed that it had received an offer from Gopher Investments on Sunday
  • The $4.04bn bid would trump that made by Aristocrat Leisure by $300,000+
  • Playtech shareholders require a bid 10% higher than Aristocrat’s to halt their acceptance
  • The supplier is a global gaming giant, with employees in 24 different countries
Playtech logo on building
In addition to its bid from Aristocrat, Playtech has now received another takeover offer from Gopher Investments, and reports suggest it is valued at around $4.04bn. [Image: Shutterstock.com]

Gopher joins the race

Only last month, Australian slot machine giant Aristocrat Leisure made its intentions clear regarding Playtech, offering $3.7bn to purchase the UK-based online gaming and sports betting provider. Now, investment firm Gopher Investments has joined that race, with a potential offer exceeding that made by Aristocrat by more than $300,000.

Playtech received a bid from Hong Kong-based Gopher on Sunday

According to Sky News, which first reported on the development, Gopher accepted advice from bankers at Rothschild as it mulled making a bid for the gaming giant. Reuters has since confirmed that Playtech received a bid from Hong Kong-based Gopher on Sunday. Although Playtech has not confirmed the amount of the offer, media reports suggest Gopher was considering a £3bn ($4.04bn) bid.

An offer of $4.04bn would trump that made by Aristocrat only weeks ago. However, Playtech has confirmed that discussions with Gopher are in an early stage and still ongoing. The investment firm already has a stake in Playtech, becoming one of the supplier’s most prominent shareholders earlier this year.

Let the games begin

According to a company statement issued on October 18, Aristocrat’s offer for Playtech values the company at around 680p ($9.35) per share, a premium of 58% over the company’s Friday closing price the week before the bid. Playtech’s shares rose as much as 57% on the day it received the offer, to 675p ($9.28).

In a Twitter post at the time, stockbroking firm CommSec said that the Playtech Board considered the “Terms of Acquisition to be fair and reasonable”:

As reported by Sky News, Playtech shareholders have kicked off a series of “irrevocable undertakings” to accept the offer. However, they could stop the process if a rival bidder offered a price at least 10% higher than the Aristocrat bid. This means that Gopher would need to bid at least 748p per share to trigger the clause.

What do they stand to win?

Playtech describes itself as the world’s largest supplier of online gaming and sports betting software. The company, founded in 1999 and listed on the London Stock Exchange, has 6,400 employees across 24 different countries. It provides its technology to the industry’s retail and online operators in markets across the world.

In 2018, the supplier also completed a $977.4m takeover of Snaitech, a leading sports betting and gaming company in Italy. The company runs around 1,600 retail properties across the country.

The supplier has also established a financial trading division called Finalto, which operates on a B2B and B2C basis. It agreed to sell that arm to Gopher for $250m in cash in September this year. Playtech expects the agreement to complete in the first half of 2022, subject to regulatory clearances and other factors.