JKO Play Pulls Out of the Race to Acquire Playtech

  • JKO Play had made a £3bn takeover bid, but withdrew its interest on Friday
  • Opposition from a group of Playtech shareholders is reportedly a reason for the withdrawal
  • Aristocrat Leisure is now the sole bidder for Playtech with its £2.7bn offer
  • A Playtech shareholder vote to consider Aristocrat’s offer will take place on February 2
Playtech office building
JKO Play is no longer in the race to takeover Playtech, leaving Aristocrat Leisure as the sole bidder. [Image: Shutterstock.com]

Exploring other opportunities

JKO Play has confirmed that it is pulling out of the race to acquire Playtech. The consortium that was led by former Formula 1 team boss Eddie Jordan had previously been planning to make a £3bn ($4.1bn) takeover bid. JKO confirmed on Friday morning that it was withdrawing its interest.

JKO was reportedly planning to offer £7.50 ($10.17) per share.

The decision came after a group of Asian Playtech shareholders who own 27.7% of the company stated that they are not in favor of a possible new offer. These shareholders reportedly bought their holdings at prices that are significantly greater than the £6.80 ($9.22) per share that Aristocrat Leisure offered. JKO was reportedly planning to offer £7.50 ($10.17) per share.

Eddie Jordan spoke about how the team had worked tirelessly in order to submit a bid that would create value for the shareholders at Playtech. Going forward, he said that JKO Play will “continue to evaluate a number of opportunities in the gaming and associated technology sectors, where we see exciting growth prospects in a number of international markets.”

One bidder remains

JKO Play was given the opportunity to submit a firm bid for Playtech until 5pm on Wednesday, January 19, extended two weeks from the original January 5 deadline. However, it appears that the consortium’s appetite to make a bid was impacted by the Asian shareholder group’s emergence. Playtech’s share price fell by 14% following the news that JKO would no longer be pursuing a takeover.

Aristocrat Leisure had made a bid worth £2.7bn ($3.66bn) to acquire Playtech

Playtech is one of the world’s leading online gaming software companies. Major Australia-based slot machine producer Aristocrat Leisure had made a bid worth £2.7bn ($3.66bn) to acquire Playtech. Gopher Investments, the second-largest Playtech shareholder, had shown interest in making a bid, but it withdrew its interest in November.

Playtech said on Friday that it was in communication with shareholders regarding Aristocrat’s offer. However, it also stated that “a number of material investors have not to date engaged meaningfully about their views.” A shareholder vote is set to take place on February 2 regarding Aristocrat’s offer.

Aristocrat looking to close the deal

Following the news that JKO had pulled out of the race for Playtech, Aristocrat announced that regulatory approvals for a takeover are “well on track.” The company believes that its offer presents “attractive cash certainty” and is of full value. Aristocrat noted that it is the sole remaining bidder and that it hopes to complete the acquisition as fast as possible. It had originally hoped to complete the takeover in the second quarter of 2022.

Aristocrat Leisure is listed on the Australian Stock Exchange and has been producing slot machines since 1953.

The boards of both Playtech and Aristocrat had recommended the acquisition in October before the JKO Play consortium emerged. Aristocrat is now calling on Playtech shareholders “to vote in favour of the recommended acquisition at the relevant shareholder meetings to be convened on 2 February 2022.”