NetEnt acquisition by Evolution officially approved
In the summer of 2020, Evolution Gaming AB acquired the software manufacturer NetEnt made a takeover bid. This included 20 trillion Swedish kroner. NetEnt could not refuse such an offer. Nevertheless, the deal was not allowed to go ahead at the time - some regulators wanted to investigate the process, including the U.K. Competition and Markets Authority (CMA). The result of the investigation has now been announced.
CMA agrees to takeover
The positive answer reads: The CMA agrees to the acquisition. But why was an investigation scheduled at all? Well, Evolution Gaming Group AB develops online casino games that are presented through numerous gambling providers. So there are different versions of live roulette live blackjack games. And NetEnt develops both the software and their own slots. Thus,both companies could be considered as competition to each other.
What usually makes good competition? These are in a competitive relationship with each other. Healthy competition ensures that prices are not set by one company and that a wide variety of products are offered. And this is exactly where theCMA comes in: It is responsible for healthy competition. As publicly announced by CMA, they wanted to assess whether the acquisition couldreduce competition. The investigation showed that this is not the case and cleared the takeover.
Maltese Competition and Consumer Protection Authority also agree
Neither Great Britain nor Malta seem to have anything directly to do with the takeover to do. However, casino fans know thatmany online casinos are licensed by Malta. Many of these providers have included both NetEnt and Evolution Gaming games in their offerings. So it seems only logical for the Consumer Protection Agency to get involved.
They have also investigatedif players are at a disadvantage if NetEnt from Evolution Gaming is acquired. If many games are offered from a single source in the future, the same conditions could apply. Likewise, the games could be adjusted to each other in terms of winning options. All of these would reduce competition and gaming opportunities.
Fortunately, the Maltese Competition and Consumer Protection Agency also gave their blessing to the takeover. Now Evolution Gaming can start again.
Shareholders still had to agree
However, the approval of these two authorities was only the first step. The shareholders also had to agree to the plan. Before that, however, the board of directors and the board of directors had agreed to the takeover.
The majority of the shareholders have also already approved. This may be due to the interesting offer made to the shareholders: those who exchanged their NetEnt shares for Evolution Gaming sharesreceived a bonus of over 40 percent. Who can resist? Nevertheless, a few responses from shareholders were still pending last week. The shareholders were given a period of reflection until November 23, 2020. If all votes are available by this time, the takeover could begin as early as December 2020.
Evolution Gaming has left a small back door open: If not everyone has agreed by November 23,could the deadline be extended again. This would also shift the takeover activities. The goal, however, is for everyone to unconditionally agree. You may have to wait a little longer for this.
However, after NetEnt's chairman Mathias Hedlund also agreed to the takeover andannual cost savings of 30 million euros, most shareholders will probably agree. Already in June, the stock market reacted to the idea: the prices of NetEnt stocks rose, Evolution's stocks fell. Anyone familiar with stocks will know how to interpret this correctly.
The reasons for the acquisition
Many wonder why Evolution Gaming AB came up with the idea of acquiring NetEnt in the first place. One reason is the American market. Evolution would like to gain a foothold there –NetEnt already owns a few licenses for the USA. With the takeover, these will go into the hands of Evolution.
Evolution Gaming has been creating live lottery games for some time. These craps are very popular in the USA. This also gives the group easier access. And as Evolution Gaming admits, they want to bethe world leader in the online casino sector. With the takeover, this wish could come true, especially since NetEnt is also satisfied with this idea.
Back to the online casinos again. NetEnt has already signed deals with Parx and DraftKings. This fact also helps Evolution to implement their plans. These also includethe expansion of online casinos. One reason is the corona pandemic. This clearly showed how badly the local gambling providers suffer and repeatedly have to accept losses in sales. This has already led to some poker rooms in Las Vegas being closed forever.
If you want to remain the market leader, you have to react to situations like this. And this works with the exciting slots from theHouse of NetEnt: Starburst and Mega Fortune come from this company. A look at the Canadian gambling sector also makes it clear why Evolution is taking over NetEnt: From next year, no casino games may be offered to Canadian players - but slots are merger agrees. Theoretically, they could have pursued the same goals.
Bleibt trotz allem die Frage offen, warum NetEnt mit der Fusion einverstanden ist. Theoretisch hätten sie die gleichen Ziele verfolgen können.