Despite the doomed Playtech agreement, Aristocrat's internet aspirations remain unabated.
The board of directors of New York-based igaming company Playtech supported an acquisition bid from Aristocrat in October for £2.7 billion (€3.2 billion/$3.7 billion), pending shareholder approval.
Even though more people are expected to vote in favour of the merger than against it, Playtech announced today (2 February) that the proxy votes gathered so far indicate the purchase will not meet the 75% threshold needed for Aristocrat's offer to move forward.
We regret to inform you that our suggested bid to purchase Playtech plc is anticipated to expire. The developments since our offer was announced have been extremely uncommon and mostly outside of Aristocrat's control, despite the company's thorough due diligence, according to Trevor Croker, chief executive and managing director of Aristocrat.
"The chances of our offer, which had been recommended by Playtech's board of directors, being successful were significantly diminished when a faction of shareholders emerged and amassed a blocking stake without cooperating with us or Playtech in any meaningful way."
Croker instead stated that Aristocrat will maintain its "strategic" stance towards M&A.
When it comes to mergers and acquisitions, Aristocrat is laser-focussed on what's best for our shareholders in the long run. Consistent with our customer-centric attitude, we will always approach our investment selections with a highly disciplined and strategic mindset," Croker added.
With strong product-led performance across gaming and Pixel United, Aristocrat has entered 2022 with outstanding operational momentum, flexibility, and resilience. At our next annual meeting later this month, we will be happy to provide shareholders more information.
Specifically, the company will keep looking for ways to get into the online gambling market for real money.
"From a strategic perspective, Aristocrat's commitment to participate in the online real-money gaming (RMG) segment will not change," Croker noted. One way we plan to harness our world-class content, create new experiences that bring customers deeper into the Aristocrat brand, and increase value across our whole portfolio is through our online RMG capacity.
In keeping with our strict investment standards, high regulatory requirements, and honesty, our attention is now turning to speeding up our plans for alternate online RMG scaling possibilities and carrying out our expansion strategy. More information will be shared with shareholders in the future.
Despite the absence of a competing offer, the Playtech shareholders are expected to reject the bid. Formula One tycoon Eddie Jordan and industry stalwart Keith O'Loughlin's JKO Play was in the running to acquire the company until last month, when Playtech revealed that its shareholders' voting intentions were still uncertain.
In the event that the Aristocrat deal could not be authorised, Playtech reportedly considered dissolving its business last week. If the transaction fell through, Playtech did not reveal if it was contemplating a break-up sale. But today the board made it official, announcing that it would shift its attention to increasing shareholder value through the sale of Playtech's business-to-business and business-to-consumer divisions, with talks continuing.
