CVC Capital Partners has agreed to acquire a controlling stake in Sky Betting & Gaming from media powerhouse Sky in a transaction that values the company at £800 million, according to a statement.
The price represents a multiple of approximately 15x EBITDA for the 12 months ended 30 June 2014. CVC used approximately 50 percent of equity and 50 percent of debt for the transaction, according to a market source.
CVC declined to comment further on the deal, which is subject to regulatory clearances in the UK and Ireland, and expected to close in the first quarter of 2015.
Sky Bet was formed in 2001 and has grown rapidly since then, through its strong partnership with Sky Sports. Sky Bet was one of the first operators to recognise the potential of online and mobile platforms for betting and gaming, and today operates across a number of verticals: Sky Bet, its sports betting business; Sky Vegas & Sky Casino, its casino gaming businesses, Sky Poker and Sky Bingo. Oddschecker, the UK’s leading odds comparison site is also part of the acquisition.
The Sky Bet management team will remain with the business under the new ownership structure, as will all of Sky Bet’s employees. Sky will work in partnership with CVC at Sky Bet, retaining an equity stake of approximately 20 per cent and having board representation.
CVC made the investment using equity from CVC European Equity Partners V, a €10.75 billion fund that closed in 2008, it is understood. This will be the last deal from that vehicle.
CVC has already been investing its latest flagship fund, CVC European Equity Partners VI, which closed on its €10.5 billion hard-cap in June 2013. In October, CVC used this vehicle to acquired ParocGroup, a producer of stone wool insulation in the Nordic and the Baltic regions for approximately €700 million.
In June CVC teamed up with Leonard Green & Partners to acquire a majority stake in Advantage Sales & Marketing (ASM), a North American provider of outsourced sales and marketing services, from Apax Partners in a deal that was worth approximately $4 billion. In April, CVC bought a stake in Deoleo, an olive oil producer in Spain.