Online bingo operator to be bought by sports betting giant

Flutter Entertainment – which owns Leeds-based Sky Betting and Gaming – is acquiring Tombola, a UK online bingo operator, for an enterprise value of £402m.

Tombola, with teams primarily based in Sunderland and Gibraltar, was the first major UK focused operator to introduce both mandatory staking and deposit limits. It has about 400,000 average monthly players and over 700 employees.

In its financial year to end April 2021 Tombola generated pro forma revenue of £164m and EBITDA of £38.5m.

Under the terms of the transaction, Flutter will pay £402m in cash upon completion for 100% of the business.

The deal is conditional on merger control clearance by the UK Competition and Markets Authority and is expected to complete in quarter one 2022.

Flutter says the addition of Tombola to its portfolio delivers key strategic advantages, including:

·    Diversification of Flutter’s products, expanding the Group’s position in a product vertical in which it has historically under-indexed

·    Addition of an engaged and sustainable player base, with many customers active with the brand for multiple years

·    Enhancement of Flutter’s online gaming presence in its core UK market, at an attractive valuation

·    Addition of further product capabilities and expertise

·    Alignment with Flutter’s safer gambling strategy of expansion in its recreational customer base

Peter Jackson, Flutter chief executive, said: “As the world’s leading online gambling operator, we are delighted to add Tombola, the UK’s premier bingo brand to the Group.

“Tombola is a business we have long admired for its product expertise, highly recreational customer base and focus on sustainable play.

“The brand aligns closely with our safer gambling strategy, a key area of focus for us.

“I am excited to combine our digital marketing expertise with Tombola’s operational capabilities within the UK & Ireland division.”

Eversheds Sutherland and GCA Altium advised Tombola and the sellers and Freshfields advised Flutter.

Martin Larsson, managing director at GCA Altium, said: “This is an excellent strategic fit for both parties involved and sees the combination of two powerhouses in the UK gaming market.

“We see Flutter as a good home to uphold the company’s legacy and support the team as it continues to capitalise on the exciting growth opportunities that lie ahead.”