CVC Capital Purchases Sky Bet
In a deal that’s been valued at over £800 million, Sky has sold a controlling stake of Sky Bet, their online gaming and betting company, to London based Private Equity firm, CVC Capital.
The British broadcaster has said that the sale of their online gaming business to the private equity firm will “crystallize value”, thus enabling them to focus on “significant opportunity for growth in Pay TV across the five markets which it operates”.
“This transaction will allow us to focus further on substantial growth opportunities in our core-international pay-tv business, while realizing significant value for our shareholders,” said Sky’s Chief Executive, Jeremy Darroch.
Last month the company announced that it was dropping “British” as well as “Broadcasting” from its name and rebranded the company “Sky” after it completed its takeover of Sky Deutschland and Sky Italia, a deal that was worth £3 billion.
Sky will retain a small equity stake of Sky Bet with 20% of the company, as well as a seat on the board of directors.
The terms of the transaction state that Sky will receive £600 million in cash on completion of the deal as well as a further payment of up to £120 million, depending on the performance of Sky Bet. The terms of the deal also include a long-term brand license agreement with Sky that will allow CVC to keep the Sky name and operate the Sky brand.
Sky Bet was created in early 2001 and has since grown into one of the UK’s biggest online betting companies, largely due to the well-known Sky brand. Last year, Sky Bet stepped in at the eleventh hour to rescue the Football league after they had failed to find a sponsor and Sky Bet continues to be the title sponsor of the Football League.
The Sky Bet portfolio includes: Sky Vegas, Sky Casino, Sky Poker and Sky Bingo.
“In the last ten years, we have successfully grown Sky Bet from a start up to one of the leading online betting and gaming companies in the UK,” said Jeremy Darroch speaking at the announcement of the sale.
“We are delighted to have agreed to acquire a controlling stake in Sky Bet,” said CVC’s Managing Partner, Rob Lucas. “The partnership between CVC and Sky will provide a strong platform to support Sky Bet’s ongoing success at this exciting point in its development.”
Before the deal can be completed, it must be cleared by various regulators in the United Kingdom and Ireland, but it’s expected to be completed in the first quarter of next year.
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