Blank cheque firm Cohn Robbins will soon acquire Allwyn Entertainment in a transaction that values the European lottery operator and gaming operator at $9.30 billion. This is a deal that allows investors of the Cohn Robbins SPAC (special purpose acquisition company) to purchase shares at a discount valuation. It will also lead to Allwyn being listed on the NYSE.
Allwyn Closer to Realizing Public Dream
Allwyn manages lotteries in Italy, Greece, Greece, and the Czech Republic. The company is also vying to be granted the next UK lottery license, which will expire in 2023. Next month will see the announcement of who was the successful bidder for this lottery. It saw ticket sales of around £8.4 billion ($11.37 billion) over 12 months from May 2020 to April 2021.
Part of the proceeds of the merger will be used to fund potential acquisitions or tenders for licenses in new markets in Europe and the US. Allwyn will be sold by KKCC Investment Group, its parent company. SAZKA Entertainment changed its name to Allwyn in December.
Robert Chvatal, CEO of Allwyn, stated that it was a good time for Allwyn to make this move. Allwyn is building deeper, more personalized, and more valuable relationships than ever with its customers, as consumers expect to be able to pay online for entertainment.
Based on an estimate of Allwyn’s 2022 EBITDA (earnings before interest, taxes, depreciation, and amortization), the valuation was calculated at 11.5 times that amount. Allwyn reported an EBITDA of $810 million for 2022 based on $1.7 billion in revenue.
What the Deal Means For Allwyn Shareholders
Current Allwyn shareholders will retain approximately 83% of the new company’s equity, with no shareholder holding more than a 5% stake. The merger is expected to close by the end of the second quarter. Although no ticker was revealed, the new entity will trade on the NYSE.
Allwyn said that recent advances in the legalization of online lottery, sports, and iGaming indicate the potential for significant additional online penetration into markets where Allwyn operates and those it has targeted to expand.
Once the NYSE listing arrives, Karel Komarek will still hold a controlling interest in Allwyn. His stake will be a little more than 80% of the company. Provided everything stays on track, the listing could happen sometime during the first half of this year.