PlayTech making Big Moves to expand its financial division

PlayTech Plc, one of the leading providers of gambling technology is planning to expand its financial division as it buys customer assets, intellectual property and trading platform from privately-owned ACM group.

Founded in 1999 by Israeli billionaire Teddy Sagi, PlayTech has more than 3600 employees spread across their twelve offices worldwide. Teddy initially founded this company in Tartu Estonia, along with a group of entrepreneurs from the multimedia, Casino and software engineering industry and today PlayTech provides software for all the major online casino’s.

Headquartered in the Isle of Man, the gambling and investment trading company has boosted its revenue and profits considerably during the first half of 2017. As part of their expansion process, they are making further acquisitions including the recent investment of $150million on Alpha, a UK-based financial dealer and broker for professional and institutional clients.

Alpha Capital Markets (ACM), simply known as Alpha has reported revenues £21.9 million for the last 9 months which was an astonishing growth of 266% compared to previous results. Muhammad Al-Amin Rasoul, the CEO of Alpha told that the acquisition of new institutional clients helped them to boost their revenue significantly. He was also happy with this union of Alpha’s team to TradeTech Group as the asset base and strength of the new management team will help in the further growth of the company.

PlayTech acquired Alpha from ACM group with an initial up-front payment of $5m, and the total deal is estimated to be worth $150 million. The deal also promises two staged payments based on 1 x EBITDA (Earnings before interest, tax, depreciation and amortization) of both 2017 and 2018; contingent consideration based on 5.2 x EBITDA in 2019. This acquisition deal is expected to be completed by Sep 30, after certain conditions are met. PlayTech CEO told the media that the acquisition of brokerage firm Alpha and their intellectual property will help in expanding the product portfolio and range of services offered to its professional clients.

PlayTech is currently the largest online gaming software supplier in the mainstream market of London and is making a series of acquisitions to boost its growth. By acquiring Alpha’s proprietary technology which helps financial brokers to track different trades closely, they will be able to propose new trading ideas to their professional clients.

The company also told that the twenty employees of the newly acquired Alpha will join PlayTech’s financial division, which has been recently renamed as TradeTech Group. The trading, risk management and business development teams of the ACM’s group will also join the TradeTech group. Ron Hoffman, who heads this division, told the media that this acquisition would extend TradeTech’s proficiency in trading and risk management. With the help of new technologies and knowledge acquired from Alpha, the group will be able to provide complete turnkey solutions to B2B clients across the globe. The group is planning to offer Alpha’s services through their MarketsPro platform, which will target high net-worth investors.

PlayTech is listed on the London Stock Exchange and is also a part of the FTSE 250 index. The company’s revenue has increased by 30% to €421.6m in the first half of 2017 when compared to previous year. The net profits also surged by 21% to €89.6m.  The company made this acquisition to expand its software offering to B2B customers.

PlayTech has been growing steadily, and they had already invested more than €240m in a series of acquisitions during the fiscal year of 2016. They acquired a financial trading systems developer named Consolidated Financial Holdings A/S (CFH Group) in November 2016 for a whopping $120 million. CFH provides software which allows brokers to process trades across a broad range of asset classes swiftly. All these acquisitions are done with an intention to expand its financial products portfolio. The CEO of PlayTech, Mor Weizer told that they remain optimistic about their growth and plan to make further acquisitions whenever they find the right opportunity.

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