Penta working with JP Morgan to explore “strategic options” for Fortuna

Penta is exploring its options for Fortuna, which currently operates in Poland, Croatia, Romania, Slovakia and the Czech Republic, running sites and betting shops under the Fortuna, Casa Parulior and PSK brands.

Any sale of Fortuna could purportedly be worth up to €2bn (£1.7bn/$2.2bn), according to Reuters which broke the news. Penta acquired a 79.8% stake in Fortuna in 2017, having first bought into the company in 2005, before launching a takeover bid in 2018.

While not ruling out an exit, Penta is evaluating alternatives that would best help the development of the Fortuna franchise, the business told iGB, while ensuring sustainable growth and the creation of long-term value.

“As discussions are in their early stages, it’s premature to speculate on the specific outcomes,” Penta said. “However, the possibility of a majority sale remains within the realm of consideration.”

This doesn’t necessarily mean it will cash out of gaming entirely, however.

“Penta, as a long-term investor, remains committed to the sector,” it said. “Our continued interest in the industry is driven by a robust belief in its potential and enduring value.

“We find the sector attractive and are looking to stay in it.”

Fortuna taken private by Penta in 2018

Following Penta’s full takeover in 2018 through its Fortbet Holdings subsidiary, Fortuna was delisted from the Warsaw and Prague stock exchanges.

The delisting would free Fortuna from public disclosures that would leave it at a disadvantage to its competitors, the operator said at the time.

Victor Corcoran, former chief executive of Paddy Power Online, leads Fortuna as CEO, replacing interim chief David Vaněk. Vaněk took charge after Per Widerström – now CEO of 888 Holdings – left in February 2022 after seven years at the helm.

The next big CEE acquisition?

Fortuna’s presence across major markets in Central and Eastern Europe (CEE) could make it an attractive acquisition target as the industry turns its attention towards the region as a source of new revenue.

Entain has been the most active acquirer in CEE, in part due to its Entain CEE joint venture with EMMA Capital. It acquired a 75% stake in SuperSport, a leading betting and gaming brand in Croatia, in August 2022, then a year later snapped up Poland’s STS Holdings. While some shareholders have questioned these deals, Entain CEE is eyeing up additional deals for market-leading omnichannel brands in the region.

Paddy Power operator Flutter Entertainment has also made moves in the region. The company acquired an initial 51% stake in Serbian omnichannel sports betting and gaming operator MaxBet for €141m in September. The agreement also gives Flutter the chance to acquire the remaining 49% of MaxBet in 2029.

The deal provides Flutter with access to the regulated Serbian market and aids its ongoing expansion plans, including within the wider Balkans region.