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Thursday, November 22, 2018

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GVC Aspires to Australian Betting Market Dominance with Neds Acquisition

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GVC Aspires to Australian Betting Market Dominance with Neds Acquisition

GVC adds Neds International to Australian business amid consolidation wave in the local sports betting field

Gambling giant GVC Holdings has snapped up Australian online sports betting operator Neds International in a bid to further extend its footprint across the lucrative Australian gambling market. GVC would pay up to A$95 million for the newbie bookie which only launched its operations last year but has grown tremendously.

GVC operates in Australia through the Ladbrokes brand. The Isle of Man-headquartered gambling group acquired Ladbrokes Coral and its digital and retail operations across multiple markets in a £4-billion deal this past March.

Neds was founded last year by bookmaker and entrepreneur Dean Shannon. Mr. Shannon was previously the CEO of Ladbrokes’ Australian business, which makes the recent tie-up between his new company and the one he was formerly employed at not an entirely unexpected move.

Despite being in the field for about a year, Neds is on track to handle A$1-billion worth of wagers and generate A$100 million in revenue this year.

GVC said in a statement from today that the combination of Ladbrokes’ Australian operation with Neds would result in cost savings of around A$16 million per year. Jason Scott, the current Ladbrokes Australia CEO, will lead the enlarged business, while Mr. Shannon will stay on as a consultant.

Commenting on the deal, GVC CEO Kenneth Alexander said in a statement that “Australia is a core market for the Group and today’s acquisition further strengthens [their] position.”

Mr. Shannon pointed out that “GVC is a natural fit for the Neds business” and that “[they] share the same entrepreneurial ideals” while delivering “market leading products and service to [their] customers.”

Wave of Consolidation

GVC’s acquisition of Neds has become the latest deal of this kind to be taking place within the Australian bookmaking space. Growing competition and demand for quality betting services as well as regulatory pressure and new gambling taxes have spurred unprecedented consolidation activity in Australia.

Early this year, William Hill announced that it would sell its underperforming Australian business after years of struggles to establish itself Down Under. CrownBet (now BetEasy) was selected as the winning bidder to acquire William Hill Australia after a competitive bidding process. At about the same time, Canadian gambling giant The Stars Group announced that it would buy an 80% stake in CrownBet from its previous owner, Australian casino operator Crown Resorts.

As the Australian sports betting field has grown rapidly over the past several years, a number of states and territories have decided to implement the so-called point of consumption tax, seeking a share of what licensed bookmakers generate for servicing punters based within their borders. New South Wales and Victoria are to become the latest states where said tax will be rolled out. That is set to happen on January 1, 2019. It is believed that the new tax regimes across Australian states and territories have, too, contributed to the wave of consolidation in the sector.

GVC said that with the acquisition of Neds it expects its Australian business to enter top three of the corporate bookmakers servicing the local market. The gambling company also hopes to become the market leader in the region at some point in future.

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The post GVC Aspires to Australian Betting Market Dominance with Neds Acquisition appeared first on Casino News Daily.

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