FDJ Reports 6.5% Rise in Revenue and Makes Offer to Acquire Kindred Group

In its full-year 2023 trading update, La Française des Jeux (FDJ) announced a 6.5% increase in revenue for the 12 months ending on 31 December. This update comes as the lottery and gaming company revealed it had submitted a SEK27.96bn (£2.10bn/€2.45bn/$2.67bn) offer to acquire Kindred Group, as reported by the Wall Street Journal over the weekend.

FDJ’s acquisition offer aims to establish a “European gaming champion.” Kindred CEO Nils Andén believes that joining forces with FDJ will help Kindred to “further expand its global footprint.” Kindred’s preliminary 2023 results, released on 22 January, showed revenue of £1.21bn for the full year.

FDJ’s total revenue for 2023 amounted to €2.62bn, with online gaming revenue growing by 18.8%, making up 13% of its overall revenue, compared to 11% in 2022.

Recurring EBITDA for FDJ also saw growth in 2023, attributed to its digital businesses, with a value of €657m for the year, resulting in a margin of 25.1%. FDJ noted that this would have been 24.3% if not for the reversal of a provision relating to disputes with broker agents and high sports results.

The acquisition bid for Kindred follows a year of steady M&A activity for FDJ. The company had a net cash surplus of €671m at the end of December, 25.4% less than the €900m generated in full-year 2022, following payments related to the acquisitions of ZEturf and Premier Lotteries Ireland.

For the fourth quarter of 2023, FDJ reported a 13.8% increase in revenue to €747m, with lottery revenue growing by 7.8% to €531m and competitive sports and online gaming revenue increasing by 14.9% to €159m.

FDJ’s offer to acquire Kindred involves SEK130 in cash for each of Kindred’s Swedish Depository Receipts, which is 24.4% higher than the price of Kindred shares at the close of trading on 19 January. Kindred has unanimously recommended that its shareholders accept FDJ’s offer, with an acceptance period projected to occur from 20 February to 19 November.

FDJ CEO and chair Stéphane Pallez stated that Kindred would naturally align with FDJ’s strategy, leading to a stronger strategic positioning and significant value creation for the benefit of the shareholders and broader stakeholders. Full 2023 results for FDJ will be published before trading begins on 15 February.

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