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    Flutter Entertainment (FLTR) bets big on Italian Sisal for £1.62bn

    By Adrian Holliday

    09:19, 23 December 2021

    Photo of a Paddy Power retail franchise shopfront with white logo on green background
    Flutter Entertainment is the owner of the Paddy Power brand – Photo: Shutterstock

    Flutter Entertainment’s share price flapped 3.2% higher in early trading at 116.80p as it revealed it was buying Italian betting and lottery operator Sisal for £1.62bn (€1.92bn) from CVC Capital Partners Fund VI.

    Cash buy

    Flutter (FLTR), which also controls the Paddy Power and Betfair brands, says Sisal anticipates underlying earnings of €248m in the 12 months to December, with 58% of earnings from online sales. The private equity sale, paid in cash, includes full repayment of all Sisal’s debt. 

    Flutter Entertainment (previously called Paddy Power Betfair) says that, after the UK, Italy is the second-largest regulated gambling market in Europe with gross gaming revenues in 2019 of €19bn.

    “For some time we have wanted to pursue this market opportunity via an omni-channel strategy and this acquisition will ideally position us to do so,” said Flutter chief executive Peter Jackson.

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    Sisal online opportunity

    Jackson says Sisal is growing its online presence – and omni-channel operators, like Sisal, have potential for more retail and online growth.

    Italian online penetration rates are below UK and Australia, Flutter says. “The Italian online market is projected to be worth £3.6bn by 2024, equating to [a] forecast five-year compound annual growth of 18%.”

    Sisal’s online market share is currently 11.9% but Flutter hopes to reach “circa 20%” over time. The sale is expected to complete by the second quarter of 2022.

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    The difference between trading assets and CFDs
    The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
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