GVC Holdings has bolstered its Australian operations with a deal to acquire Neds International, the online sports betting operator founded by former Ladbrokes Australia chief executive Dean Shannon.
The operator will pay an initial AUS$68m (£39m/€43m) for the Neds business, with the maximum consideration capped at $95m.
While Neds only launched late in 2017, it has invested heavily in marketing to build its profile, and is supported by a proprietary technology platform and led by an experienced executive in Shannon. This has helped the business grow rapidly, with the operator expecting customer stakes to hit $1bn and gross gaming revenue to reach $100m for its financial year ended December 31st, 2018.
“Australia is a core market for the Group and today's acquisition further strengthens our position,” GVC chief executive Kenny Alexander said. “Neds is an exciting business, with talented people and enables us to further grow market share through two differentiated brands.”
GVC notes that combining Neds and Ladbrokes Australia will create one of the three largest businesses in the market, as well as achieving annual synergies of around $16m. The deal is expected to be earnings accretive from 2020 onwards.
It could also see Neds’ executive chairman Shannon rejoin Ladbrokes Australia, having left the company in February last year to start up a new venture. He first joined the business in September 2013 after Ladbrokes acquired his previous online betting business, Bookmaker.com.au, in a $22.5m deal.
“GVC is a natural fit for the Neds business, we share the same entrepreneurial ideals, whilst delivering market leading products and service to our customers,” Shannon commented.
However, it is unclear whether Shannon will retain a role within the combined business once the acquisition is completed. Current Ladbrokes Australia chief executive Jason Scott is to continue in his role to oversee both companies, noting that he was “thrilled” to do so.
“The transaction proves beyond all doubt that GVC is here to stay in the Australian market,” Scott added.