Gopher Investments has pulled its offer to buy London-listed gaming company Playtech from Gopher Investments in the wake Eddie Jordan-led €3.56-billion ($4.01 billion) entrance into the competition. Gopher, based in Hong Kong owns 4.97% of Playtech and is already looking to buy its Finalto financial trading section. This deal should be completed in the first quarter of next year. Gopher, however, confirmed in a press release that it will not make an offer for Playtech on Friday.
Gopher Walks Away, for Now
Gopher backed down, leaving Aristocrat Leisure, the Australian gaming services provider, in the lead. Aristocrat’s bid of $3.7-billion is supported by the Playtech Board. The only other contender right now is JKO Play. The consortium is led by Eddie Jordan and Keith O’Loughlin, both digital gaming executives from Ireland, with support from Centrebridge. They have not yet to make an offer.
Gopher has given up the possibility to re-enter, regardless of whether the offer from Aristocrat is rejected or JKO presents a formal offer. Its actions suggest that the Hong Kong firm does not want to be involved in a bidding war and would stand to benefit from a competitive sale.
JKO Play revealed that Jordan and O’Loughlin had teamed up specifically to make a play for Playtech.
Playtech Stock Takes a Dip
Not necessarily tied to the news, Playtech’s shares were slightly lower on Friday than Thursday’s close of $9.83. It’s still up on Aristocrat’s $9.15 per-share offer, and it is where the stock traded prior to the Jordan approach.
Jordan is a racing legend. In 2005, he bought Formula One’s Team Jordan for $84.48 million. His partner, O’Loughlin, has a long history in the gaming industry. He worked for US giant Scientific Games, Ladbrokes Coral, and BoyleSports.
The decision to back away from a potential Playtech acquisition doesn’t change the outcome of the purchase of Playtech’s Finalto division. That arrangement is still moving forward and a definitive agreement is already in place. According to the company’s statement, “Today’s announcement has no bearing on Gopher’s agreement to acquire Playtech’s financial trading division, Finalto. Gopher remains fully committed to the acquisition. The process is ongoing and is expected to complete in H1 2022.”
However, Gopher could come back to a potential Playtech takeover, as well. If Aristocrat (or JKO) doesn’t continue with their plans, Gopher has reserved the right to jump back and make a potential offer.