The Stars Group completes acquisition of UK gambling giant

The Stars Group Inc. announced Tuesday that it has completed its previously announced acquisition of Sky Betting & Gaming.

“This acquisition represents a pivotal moment in The Stars Group’s evolution,” said Rafi Ashkenazi, The Stars Group’s CEO.

“SBG’s mobile-focused sportsbook pairs well with our poker offering to create two premier customer acquisition channels. We believe this combination along with our combined online casino offerings positions The Stars Group for continued growth in the evolving online gaming industry.”

The acquisition also provides The Stars Group with multiple expected operational and financial benefits, the statement notes, including:

* Dramatically improves The Stars Group’s revenue diversity, creating a balanced spread across poker, casino and sportsbook with a broad geographic reach.
* Increases The Stars Group’s presence in locally regulated or taxed markets to approximately 75% of combined revenues.
* Develops sports betting as a second customer acquisition channel, complementing The Stars Group’s core offerings and creating an opportunity to cross-sell players across multiple verticals.
* Enhances The Stars Group’s products and technology through the addition of SBG’s innovative sportsbook and casino offerings and portfolio of popular mobile apps.

“This transaction creates the world’s largest publicly listed online gaming company and unites two iconic brand portfolios with strong technology platforms and teams. This significant scale also positions The Stars Group to both secure and expand upon its global footprint,” concluded Ashkenazi.

Consideration for the purchase of SBG comprised a combination of cash and approximately 37.9 million newly-issued common shares of The Stars Group. The cash consideration of the acquisition was financed through cash on the balance sheet, proceeds from The Stars Group’s recent equity offering and newly issued debt consisting of:

$100 million from its revolving credit facility, which was increased to $700 million, priced at LIBOR plus 3.25 percent and maturing in five years;
$4,567 million equivalent in new first lien term loans, comprising a U.S. dollar denominated tranche of $3,575 million priced at LIBOR plus 3.50 percent and a Euro denominated tranche of Euro 850 million priced at Euribor plus 3.75 percent, and each with a zero percent floor and maturing in seven years; and
$1,000 million in 7.0 percent unsecured senior notes due July 2026.

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