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Is It Advantage JKO in Playtech Pursuit?

Dart on Boardroom TableAs they contemplate two serious suitors in the pursuit of a takeover bid, Playtech has revealed that they have postponed a scheduled shareholder meeting that would have voted on Aristocrat’s offer.

Instead, more time will be given to JKO Play – a consortium led by former F1 supremo Eddie Jordan – to table their bid and begin discussions with the online casino software firm.

That will come as something of a hammer blow to Aristocrat, the Australian slot machine developer, who had already agreed terms on the acquisition of Playtech as far back as October, with a package worth £2.7 billion given the green light ahead of the planned shareholder vote on January 12.

That has now been rescheduled for February 2 – giving JKO Play around three weeks (they have been handed a January 26 deadline) to come up with a deal that trumps that of their Aussie rival.

The consortium, founded by Jordan and iGaming specialist Keith O’Loughlin, only announced their interest in Playtech a matter of weeks after Aristocrat’s bid became public knowledge, and after requesting due diligence information it’s believed that the team behind JKO Play have been in continuous communication with the object of their affections ever since.

They were initially given a January 5 deadline to make a formal bid, but that has now been extended – suggesting that Playtech are very interested in what they have to say.

Aristocrat have secured a number of ‘irrevocable undertakings’ as part of their package, and their bid will lapse if a rival party bids at least 10% higher than their initial 680p a share offer.

That means that a bid of 748p per share or higher would be enough to kick Aristocrat out of the running, and it’s rumoured that JKO Play – backed by a number of investors including the equity firm Centerbridge Partners – will table an offer of 750p a share.

Getting Gazumped

Business Chess

Aristocrat had originally been planning for their takeover of Playtech to be completed in the second quarter of 2022 – until JKO came along and put a major spanner in the works.

They had already seen off the threat of a bid from Gopher Investments, who instead decided to acquire Playtech’s financial trading operation Finalto – a move that cleared the path for Aristocrat.

But JKO’s interest was just one stumbling block in their path, with the activities of a large group of Playtech shareholders also causing concern.

Aristocrat have even contacted the Takeover Panel to seek assurances about the group, who are thought to include a number of high-profile Asian entrepreneurs including Karen Lo, an heiress to the Vitasoy company, and Paul Suen, the owner of Birmingham City FC.

Between them, the group owns more than 20% of Playtech’s shares, and the suggestion is that they have enough financial clout to block the Aristocrat deal at the scheduled vote and potentially launch a rival bid of their own, with an eye on capturing a slice of the unregulated Asian market.

Aristocrat’s offer would need at least 75% backing from the shareholder vote, and so this particular group of investors would represent a sizable opposition.