Paddy Power Betfair acquire controlling stake in Adjarabet
Paddy Power Betfair (PPB) has purchased a 51% stake in Adjarabet, a Georgian operator. PPB paid £101m for 51% of the company with an option arrangement to purchase the remaining 49% stake in three years.
PPB will have the option to purchase the remaining stake in the company after three years via call and put options. The valuation will be seven times the 2021 EBITDA and can be paid via cash or shares. Last year, the operator earned 215m Lari (€73m) in revenue, with an EBITDA of €23m).
Adjarabet is licensed in Georgia and offers sports betting, casino, poker, and other online games. It is the biggest operator in the country and has a 40% market share of all online revenue. The operator is also active in the deregulated Armenian market, after launching there in 2017.
Along with a strong market share, Adjarabet profits from a very high brand awareness rate, thanks to its exclusive marketing-partnership with Adjaranet, a leading Georgian media website.
The deal continue’s PPB’s strategy of diversifying its online European operation. Through being both a market-leader and having local expertise, Adjarabet was an attractive option for PPB, and will be set to benefit from the operator’s technological capabilities. PPB chief executive, Peter Jackson, explained further:
This bolt-on acquisition is in line with our strategy of establishing podium positions in attractive online markets. Ajarabet’s leading brand presence and strong management team has established it as the clear number one in the fast-growing, regulated online Georgian market. Together with our group’s technology and sports capabilities, we are confident that Adjarabet will be strongly positioned to continue to build on this success.–Peter Jackson, Paddy Power Betfair chief executive
The Georgian market has experienced healthy growth over the last few years. Since 2016, the market has grown 40% to €206m.