Playtech targets consolidation opportunities following TradeFX takeover

Playtech targets consolidation opportunities following TradeFX takeover

Thursday, April 2, 2015 Totally Gaming

Playtech chief executive Mor Weizer has told TotallyGaming.com that the gaming software and service company is to use its acquisition of a majority stake in TradeFX to pursue consolidation opportunities in a “fragmented” market.

Playtech has conditionally agreed to acquire a 91.1-per-cent stake in TradeFX, an online CFDs and binary options broker and platform provider, in a deal worth €208m ($225m) up front before an earn-out payment of $250m based on future performance.

“The sector remains fragmented and we believe this is likely to give rise to further acquisition opportunities in the future,” Weizer told TotallyGaming.com.

“Following the acquisition, we will retain significant resources to continue to pursue further acquisition opportunities.”

TradeFX offers its services in more than 100 countries around the world in 25 languages. The company posted earnings before interest, tax, depreciation and amortisation of $34.9m in 2014. 

“The acquisition is immediately earnings enhancing and provides us with an opportunity to enter a growing and highly complementary vertical driven by similar core competencies, and is in line with our strategy to acquire profitable, regulated, highly cash generative businesses in market-leading positions,” Weizer added. 

“The acquisition also adds weight to the strong momentum with which we have started the year and which has continued throughout the first quarter.

“Our combined operational superiority will enable further exciting growth opportunities. With our existing cutting-edge IMS platform, and TradeFX’s complementary CRM capabilities focused on increasing customer conversion rates and maximising customer lifetime value, we are well placed to accelerate many of TradeFX's growth initiatives.

“It is an established platform in a dynamic and fragmented growth market, with similar characteristics to the gambling industry, providing access to a broad range of consolidation opportunities.”

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