France’s FDJ offers to buy Swedish online gaming firm Kindred in $2.8 billion takeover bid
Daniel Levi
Posted On January 22, 2024
French gaming company La Francaise des Jeux SA (FDJ) launched a takeover bid on Monday to buy the Swedish online gaming company Kindred Group. The deal is set to create a major player in the gambling industry, positioning FTD as the second-largest operator in Europe’s gaming sector.
As part of the agreement, FDJ is proposing to acquire Kindred at 130 Swedish crowns ($12.43) per share, amounting to an enterprise value of 2.6 billion euros ($2.83 billion). This offer represents a premium of 24% over Kindred Group’s closing price on January 19, Bloomberg reported.
According to the announcement, the financing for this deal will come from FDJ’s internal cash reserves and a loan from BNP Paribas SA and Societe Generale SA. La Francaise des Jeux, known for its lottery scratch cards and with the French state holding a 20% stake, anticipates that the takeover of Kindred Group will enhance its earnings, resulting in a dividend per share accretion of more than 10%.
Following the announcement, shares in La Francaise des Jeux SA experienced their most significant increase since 2022, rising after the agreement to acquire Sweden’s Kindred Group for 27.95 billion kronor ($2.7 billion).
In a statement, Kindred said “several parties” have expressed interest in the company after it initiated a review of strategic alternatives last year to explore possibilities such as a merger or sale.
Kindred Group’s strategic alternatives, which include a possible merger or sale, found FDJ’s offer to be the most attractive. The board of Kindred unanimously endorsed FDJ’s offer, deeming it the most appealing outcome for shareholders, adding that it recognizes the company’s long-term growth prospects while considering associated risks and uncertainties, Reuters reported.
In another statement, the company said, “The Board believes that the terms of the offer recognize Kindred’s long-term growth prospects, taking into account the risks and uncertainties associated with the realization of those prospects.”
FDJ Chairwoman and CEO Stephane Pallez also said, “I am pleased to announce today the proposed acquisition of Kindred.” She added, “The combination will result in a stronger strategic positioning and significant value creation for the benefit of our shareholders and broader stakeholders.”
