Betsson has entered the Georgian market after agreeing a deal to acquire gaming company Europe-Bet.

The Swedish online betting operator could pay up to $85m (€76.5m) for Europe-Bet, which has a market share of about 30 per cent in Georgia. 

Betsson believes that the Eastern European country offers opportunities similar to those being established in many European Union (EU) nations, with Europe-Bet, which has both online and land-based operations, collecting revenues of $52.4m in 2014 and double-digit growth in recent years.

“Europe-Bet has established a strong brand with a competitive multi-product offering in the locally regulated market of Georgia,” said Magnus Silfverberg, the outgoing chief executive and president of Betsson.

“Together with Betsson’s technology, a foundation for profitable and sustainable growth within and outside Georgia is created.”

Betsson will pay an initial $50m to buy Europe-Bet, with a further $35m to be paid in a year’s time as long as “the gambling regulation in Georgia remains unchanged”. That total would correspond to 4.3 times Europe-Bet’s earnings before interest and tax (EBIT) for 2014.

Europe-Bet recorded online operations of $40.8m in 2014, with the remaining turnover coming from land-based business.

Betsson says that its online business is mainly sportsbook driven, which accounted for 44 per cent of total revenue in 2014. Total EBIT amounted to $20.0m, of which $17.9m is attributed to the online operations. The EBIT margin was 38.1 per cent and the company has delivered solid double-digit growth in the last years.

Silfverberg announced he was leaving Betsson in early June, with current chairman Pontus Lindwall taking over in an acting role in July.

Betsson posted its best-ever quarterly revenue results during the first quarter of 2015, recording a figure of SEK847.4m (€90.5m/$98.1m).