Though Playtech, the Israeli gambling company, announced last week that it is planning to merge with financial trading group Plus500 by the end of 2015, it has decided to step back from the proposal. The approximately £459.6 million Playtech & Plus500 merger agreement came into the news in June to be finalized in September.
The final decision was later dated to take place in December because of the agreement’s “high profile” nature and UK Financial Conduct Authority’s (FCA) concerns, according to the FTSE 250-listed company. However, the company has recently mentioned that they would not be able to meet the concerns of the (FCA) and thus, will be closing the deal within this year.
“The company has discussed with Plus500 the consequences of the recent developments with the FCA and has agreed to the termination of the merger agreement,” Playtech said, “Accordingly, the acquisition of Plus500 will not be proceeding as planned. Playtech will not incur any financial penalties with respect to the termination of the acquisition of Plus500. Playtech has no immediate plans with respect to its existing 9.9% holding in Plus500.”
Plus500, from its side, was okay to continue operating independently, said their CEO, Gal Haber, while opining on Playtech’s decision. “Following the agreement with Playtech that the merger between the companies will not proceed, we can confirm that our business is in good shape for a successful future as an independent company,” he said, “Plus500 remains a growing, highly profitable and cash generative company with strong momentum in an expanding international market.”
Haber added, “We have adopted a ‘business as usual’ policy during the lengthy acquisition timetable and continued to invest in our marketing, technology and regulatory operations during this period. As a result we are very confident that as an independent business we are well positioned to continue to deliver significant returns for shareholders including the declaration today of an intended interim dividend of $0.2121 per share and share buyback program.”
Playtech said that the termination of this deal may affect another deal of their proposed acquisition of Ava Trade that was announced in July 2015. Playtech planned to appeal the Central Bank of Ireland’s (CBI) opposition to the acquisition, in response to which the sellers of Ava Trade attempted a termination. Though that step has not taken place yet, the dissolution of the merger agreement with Plus500 may hasten that, as Playtech believes.
“Should the acquisition of Ava Trade not proceed, Playtech will not incur any financial penalties other than forfeiting the previously announced 5 million non-refundable deposit already paid by Playtech on the signing of the acquisition,” stated Playtech, “Playtech continues to appeal the CBI’s decision to oppose its application to acquire Ava Trade.”
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Duvessa loves experimenting with diverse professional attachments, the latest apparently being Gambling Herald. She enjoys travelling and meeting new people and cultures, but that does not keep her from staying true to her roots.
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