CMA issues enforcement order over proposed £3.4bn merger
The Competition Markets Authority (CMA) has served an initial enforcement on the Stars Group and its subsidiaries over the proposed acquisition of Leeds-headquartered Sky Betting & Gaming group.
In April, Sky Betting & Gaming (SBG) – which is controlled by Cyan Blue Topco – announced it had been acquired by Canadian gambling firm Stars Group for £3.4bn ($4.7bn) in a deal which would create the world’s largest publicly listed online gaming company.
Now, the CMA said it had “reasonable grounds” for suspecting that arrangements were in progress or in contemplation which, if carried into effect, would result in The Stars Group Inc and its subsidiaries ceasing to be distinct from Cyan Blue Topco, which controls the Sky Bet & Gaming group of companies.
The firms – Stars, Stars UK and Cyan – had been ordered to ensure that they were distinct before 10 July.
The CMA said that Stars and Stars UK could not take any action which might prejudice a transaction.
As such, Stars, Stars UK and Cyan have been ordered to provide the CMA with information or statements of compliance to monitor the situation. In particular, on 24 July and subsequently every two weeks, the chief executive of each of the firms will be required to provide a statement to the CMA.
The order also requires them to inform the CMA of details relating to key staff who leave or join the Sky Betting & Gaming group business or the Stars business and any interruption of the Sky Betting & Gaming group or Stars business that has prevented it from operating for more than 24 hours.
The CMA has also ordered that information is shared with them about any substantial customer volumes won or lost or substantial changes to the customer contracts.
