Management Consortium Moving Forward to Buy Finalto from Playtech

The financial unit was most profitable for Playtech in H1 2020.

The gambling software company, Playtech (LSE: PTEC) confirmed on Monday that it has entered into ‘exclusive discussions’ with a management consortium of Israeli companies for the sale of its financial unit, Finalto, previously known as TradeTech.

The consortium interested to purchase the unit is backed by Barinboim Group, Leumi Partners Limited, The Phoenix Insurance Company Limited, and Menora Mivtachim Insurance Limited.

The filing with the London Stock Exchange revealed that the consortium is making a cash offer of up to $200 million, of which $170 million will be payable on completion. Additionally, $110 million of the capital required to run the division will be transferred with the business upon any sale.

One of the Most Profitable Units

Finalto is its financial unit formed with the acquisition of the three institutional (B2B) and retail (B2C) forex market entities. Playtech acquired FX liquidity provider CFH Group in late 2016 for $120 million and later spent another $150 million for Alpha Capital Markets, a London-based FX and CFDs market maker. These entities were then combined with Playtech’s Retail FX brokerage arm Markets.com.

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The financial division remained one of its most profitable units last year as it brought in €87.3 million in revenue in the first half of 2020, 123 percent higher than the previous year.

Playtech earlier confirmed to Finance Magnates that it is indeed in talks with ‘a number of parties’ for selling the financial unit, but did not reveal any details at that time.

The latest confirmation came after the London-listed company revealed that it is expecting an adjusted EBITDA of at least €300 million for 2020 and now focusing to ‘simplify its business and dispose of non-core assets, and as such it has been continuing to evaluate all options for Finalto.’

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