14.05.2011 Betsson buys internet gaming operator Betsafe

Betsson AB located in Sweden has reinforced its market position in the Nordic countries after buying Betsafe - an online gambling operator from Malta. The deal can be valued up to ˆ60m. Betsafe deals with online casino business and runs sports betting and online poker for players mainly from Scandinavia.

Betsson is sure that this purchase would pave the way for future progress and strengthen the company’s presence in the Scandinavian market. Betsson announced last month that as of the first quarter of 2011 Nordic countries amounted to 44% of the company’s aggregate gross margin, while last year it was 51%. Pontus Lindwall, Betsson’s chairman believes that the deal would boost the company’s growth. He added that by combining their companies which are successful in a very competitive market they increase strength of their position in Scandinavian countries and improve their organization.

Betsson has bought Betsafe from some individual persons, founders and staff members . The company will pay ˆ32.5m in advance, half of which is in ready money and the other part will be payed in Betsson B shares founded on a previous 30 day mean price of the Betsson share. After it, during 2011, the additional purchase price in amount of 27.5 million (in cash or in shares) can be paid by Betsson, which will make the deal worth 60m.

Last year Betsafe’s income increased of 199% and reached 25.9m, with an EBITDA of ˆ4.5m, up by 246% compared with a year earlier. For the period of twelve months finished on the 30th of April, income reached 33.4m with an EBIDTA of 7.6m. As of March, Betsafe had 84,000 players who placed real money on its website. In addition to increasing earnings, Betsson is sure that it will benefit from the merge because of the alliance of platforms and supplier agreements. Betsson has an intention to keep all 148 Betsafe's employees and all the brands of the two companies.

Betsafe’s board, along with the founders Andre and Christer Lavold and executive officer Henrik Persson, will partly carry out Betsson operative management in Malta. Henrik Persson, Betsafe’s CEO claims that it was an advantageous deal because those two companies have similar views on how to succeed on the world gaming market. He also said that those are two powerful cultures with similar values and aims, which join efforts to develop the business and maybe become one of the biggest and most flourishing market participants.

According to the announcement shares in Betsson AB (Co. Profile) (NASDAQ OMX:BETS-B) have reached 4.28 per cent to SEK146.25 for each share in Stockholm as of 08:30 GMT that morning.