Unibet still in M&A hunt despite aborted Q1 deal
CEO Henrik Tjärnström says unsuccessful discussions were held in Q1 but confirms M&A activity still on the cards
Unibet CEO Henrik Tjärnström said the operator will continue to weigh up acquisition targets in 2015 after revealing the firm had come close to completing a deal during the first quarter.
According to the operator’s financial results released today, Unibet incurred a £0.2m due diligence cost in Q1 for a possible acquisition which failed to materialise.
Tjärnström would not to go into specific details but told eGaming Review this morning that talks between the two parties had been more advanced than previous discussions.
“This one got further than others, quite far I’d say, and got to a more progressive stage than those we look at on an ongoing basis,” he said.
“Unfortunately, for different reasons, we didn’t go all the way with that one but we’ll see what happens as we’re getting plenty of offers on an ongoing basis,” Tjärnström added.
Long-term plans
Since 2012 Unibet has completed three acquisitions; a 13.5m deal for rival Scandinavian operator Bet24 2012 and entry into the French and Australian online gambling markets with the acquisitions of Solfive SAS and Betchoice respectively.
And Tjärnström admitted the Stockholm-listed firm was still assessing the opportunities presented by new targets and did not rule out completing an acquisition before the end of the year.
“The benefit of having this strong underlying organic growth is that we can be quite selective and go for those we see long time value in,” he said.
“We’re looking at different things and if it’s part of our strategy and we can get the right terms and conditions with any party then we wouldn’t rule anything out for before the end of the year,” Tjärnström continued.
Marketing strategy
This morning the company revealed a 32% year-on-year fall in Q1 EBITDA following a substantial hit from currency fluctuations on gross winnings revenue and rising costs.
Marketing was one area of rising expenditure with spend increasing 18% year-on-year to £18.9m this year, with a significant boost to its marketing capabilities in the UK and Australia.
However, Tjärnström said he is confident the operator’s decision to ramp up marketing spend will prove fruitful in the long-term and expects the financial benefits to be felt before the end of the year.
“We see a lot of opportunity to put more money behind the brand which is part of a strategy and budget we laid out at the back end of last year,” he said.
“We’re very confident that we’ll get good returns from those investments, although on a first quarter basis it’s quite difficult to see those returns coming in now and especially in a quarter where we had FX against us,” he added.