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French Regulator Approves FDJ’s Kindred €2.45B Acquisition with Conditions

By  |  September 18, 2024
France, startups, venture capital, investment, business

France’s competition regulator, l’Autorité de la Concurrence, has given the green light to La Française des Jeux (FDJ) for its acquisition of the Swedish online gambling operator Kindred Group. FDJ’s €2.45bn bid, first announced last year, marks a significant move towards becoming Europe’s second-largest gambling group. According to Focus Gaming News, this regulatory approval advances FDJ’s strategic ambitions, but with important stipulations to prevent cross-selling between its lottery and commercial gaming operations.

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    Following the approval, FDJ has brought forward the acceptance period for the deal from November 19 to October 2, suggesting the acquisition may close ahead of schedule. This decision accelerates FDJ’s plan to expand its digital and international portfolio, positioning the company for stronger competition in Europe’s gambling market.

    Despite the approval, l’Autorité de la Concurrence has set clear conditions for FDJ. As Focus Gaming News reports, the regulator warned FDJ against promoting its commercial gaming products to French lottery customers, ensuring that lottery players won’t be directly marketed to for other gambling offerings. This condition mirrors similar stipulations from FDJ’s previous acquisition of horse racing operator ZEturf.

    FDJ has assured the regulator that it will keep the two brands—FDJ and Kindred—separate. This includes maintaining distinct websites and player databases, meaning customers will need to create different accounts for each platform. As per Focus Gaming News, FDJ has emphasized that French customers using Kindred’s platforms, such as Unibet, will experience minimal changes after the acquisition.

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    Shareholder Commitments

    FDJ’s offer for Kindred includes a cap that prevents it from owning more than 90 percent of Kindred’s total shares. Several major shareholders have already pledged their support for the deal, including Corvex Management, Premier Investissement SAS, Eminence Capital, Nordea, and Veralda. In March, Veralda directly sold a 1.11 percent share to FDJ as part of the process.

    Expanding FDJ’s Reach

    This acquisition is part of FDJ’s broader strategy to evolve from a lottery-centric operation into a diversified gambling giant. Over recent years, FDJ has pursued an aggressive expansion, entering both the payments market domestically and acquiring operators such as Premier Lotteries Ireland. Its growth continues to be supported by its push into online gaming and sports betting.

    FDJ’s revenue reflects the success of this strategy. For the second half of the year, revenues rose 11 percent year-on-year, reaching €1.4bn, largely due to its acquisitions of Zeturf and Premier Lotteries Ireland. As noted by Focus Gaming News, online betting and gaming revenue saw a 15 percent boost, with digital revenue alone soaring by 40 percent.

    Lottery operations also contributed to the company’s financial health, with revenues climbing 5 percent to €958m. New instant-win games and popular draws like EuroDreams and EuroJackpot played a key role in this growth. FDJ’s retail Amigo network has also returned to full capacity, adding further to its revenue stream.

    Source: Focus Gaming News