Playtech Revises Strategic Deal with Caliplay for Further Growth

The 1999-founded leading technology company in the gambling industry, Playtech, has announced inking a revised strategic agreement with Caliente’s subsidiary, Caliplay, a leader in the regulated Mexican online casino and sports betting market and its largest client.

The news of the amended terms of the strategic agreement comes after the two parties were embroiled in a financial dispute after Caliente refused to pay its outstanding 2023-2024 fees totaling €122 million ($131 million). 

Playtech to Hold 30.8% Equity Interest in Caliente

According to the new changes meant to drive growth, the London Stock Exchange-listed company will hold a 30.8% equity interest in Caliente Interactive, Inc. (Cali Interactive), which will be the new holding company of Caliplay incorporated in the United States.

At the same time, Playtech will have the right to receive at least quarterly dividends in Cali Interactive, as per the agreed dividend policy, name a director to the holding company’s board as long as its equity interest is maintained to a minimum of 15%, and enter a revised eight-year business-to-business software license and services agreement. 

Cali Interactive will also pay an additional $140 million in cash to Playtech over the course of four years. 

Of the amount, $12 million is due to be received right after closing. The balance will be paid in 16 equal quarterly installments of $8 million each.

Caliplay has also resumed paying the Playtech Group its software and services fees. Over €150 million ($166 million) amounting to more than 80% of the unpaid fees due from Caliplay were received by the Group.

The balance, which has been paid into escrow, will be released either in the first quarter of 2025 on the closing of the revised arrangements or by the end of next year.

The Caliplay Group will also pay certain capped revenue protections to Playtech in the following five years, December 31 2029 provided a migration away from certain Playtech software products occurs. 

The Beginning of an Exciting New Chapter 

A standstill of all legal proceedings between Caliente, Caliplay and Playtech has also been agreed upon. 

The proceedings will be dismissed in full when the revised arrangements will become effective. 

Playtech has also reviewed the updated information on Caliplay’s financial performance, confirming the latter has kept performing strongly in the first half of the current year.  

Playtech chief executive officer Mor Weizer mentioned their close collaboration with Caliplay in the past nine years meant to nurture “a successful and rapidly growing digital business in Mexico.”

Weizer added the revised arrangements were a marker of “the beginning of an exciting new chapter that will build on the impressive progress to date” while also mentioning their vision to drive “significant further growth for Cali Interactive in the future.”

Claiplay’s chairman, Emilio Hank, also took the opportunity to express their delight in finalizing the renewed agreement “which shows the inherent strength of the strategic relationship between Caliplay and Playtech” expected to help with their mission to “give the best gaming experiences to our customers in Mexico and beyond.”

The revised arrangements require approval from COFECE, Mexico’s anti-trust authority. The procedure is expected to take up to roughly half a year.