The Nordic acquisition monster - Is Expekt next?
The Nordic gaming market is no longer the same. M&A activity has picked up and in just a few months strong players in this region: Scandic Bookmakers, Danbook, Centrebet, Betsafe, Bet24 and Nordicbet were taken over by big spending Sportingbet, Unibet and Betsson. Does this fast paced train of M&A stop or is there more to come?
The next M&A candidate
Mangas seemed to have it all. Cash to splash, vision and implementational force. What happened? Their acquisitions of Expekt, Bet-at-home, Bet Clic and Everest Poker can't as of now be deemed anything else than a pure catostrophy overall. We do recognize that parts of their portfolio have fared better than the average, and we want to point out that we don't have anything against Mangas. We are sure they got very solid central planners sitting plotting fancy stuff in Excel and pushing reports to top management, but hey!!! Guys, you need a product too. This is also where we reconnect this post to the topic. Let's look at Expekt. With it's huge database of Nordic region players it probably puts water in most world domination seeking CEO focusing on this area.
Many of the skillful people in the odds department of Expekt, creating huge financial gains has left the group. These master minds have been replaced by juniors trading average market odds. This may cut cost, but are they aware what they are doing to their product? We would assume they notice a serious drop in turnover, so any improved margin due to more in sync with the market odds does not impress us. If that argument ever come across in a financial report it would be a serious sell signal for us. We like to see bottom lines packed with dollars and cents and active client figures with high turnover per customer.
It is not only the product guys that have experienced cuts. Other sections of the company has felt the knife of the group. Marketing has downsized and support is being laid off or merged with other units.
So, what can be the reason for all this cost cutting? Are they simply just building an effective organization and have met problems they were ready to face, or does it look more like they are trying to ship the bride (Expekt) away? To us it looks like Betclic Everest group CEO Ignacio Martos has been busy making sure costs have been cut and that the products are neatly packed ready to sell. Are they going to sell all of their gaming ops or only Expekt? We have no clue, but we wouldn't be surprised if Expekt is first to go and then decisions will be made about the rest.
Who are the most likely candidates to buy Expekt?
All of the villains that have been in the market place so far for sure will be ready to move on this one should the opportunity arise. Perhaps even BwinParty might feel it is time to make a move. They have been a bit on the sidelines as of late trying to make their own organization and platforms more healthy as of late, this could represent a big opportunity for the sleeping giant to return to the midst of the stage. Whatever happens, it is going to be interesting to see what happens next.