Last month, Playtech agreed to the sale of Snaitech to Flutter for a cash consideration of €2.3bn, with the igaming provider stating that it will be focusing on its “technology-led offering in high-growth B2B gambling markets with an accelerated growth plan and an extensive portfolio of strategic ventures”.

The company described the transaction as unlocking “significant capital” and in line with the board’s stated strategy to maximise value for shareholders, as once practicable to do so following the transaction’s completion, it intends to return €1.7bn to €1.8bn to shareholders, with the final amount to be determined with reference to the ongoing business’ capital needs.

In addition, Playtech will repay amounts outstanding on its bond of €350m due March 2026, “significantly strengthening” its balance sheet.

However, it is the €1.7bn to €1.8bn return to shareholders that has been criticised, as this features bonus awards for a maximum aggregate amount of €100m to be paid to members of Playtech’s senior team including CEO Mor Weizer and the company’s executive directors.

A separate aggregate cash bonus pool of €34m will also be paid to the senior management team of Snaitech, of which CEO Fabio Schiavolin will be the largest participant.

Playtech also outlined a transformation plan in which “one-off awards will be granted to plan participants (including Playtech’s executive directors) entitling them to share in a pool of value which is equal to up to 10%” of any future shareholder distribution value.

In an open letter to Playtech’s Remuneration Committee Chair Anna Massion, one of the company’s shareholders, Jeremy Raper of Raper Capital, protested against the transaction, calling it “the most egregious case of shareholder value expropriation in the history of UK public markets”.

Raper added that the transaction exemplifies “crony capitalism at its absolute worst”, highlighting how several components of the company’s plan directly violate many aspects of the Governance Code, as well as notifying that he has forwarded the letter to the Financial Conduct Authority as a formal complaint.

Within his letter, Raper also stated that no details are provided on a bonus upper limit or if a portion would be paid in shares, communicating that it is “rather both retroactive and ad hoc; and simultaneously open-ended and tied to any future asset sale management may consummate, irrespective of the fundamental value achieved in any potential transaction”.

He noted: “Management is thus incentivised under the new plans to pull the trigger on any future deal, no matter how destructive to the company, and collect their 10% take, rather than persist in the better course of simply growing the business independently for all shareholders.”

A similar open letter was sent by Palm Harbour Capital Managing Partner Peter Smith on behalf of the investors in the Palm Harbour Global Value Fund, who are Playtech shareholders, to the company’s board Chair Brian Mattingley.

Smith stated that the payment has come “simply because there is a large cash inflow and for no other reason”. 

He said: “There is already in place a strong remuneration package with part of it linked to shareholder returns. There is absolutely no need for this additional payment.”

Although no date has been set, Playtech did state that a shareholder circular, required resolutions and a general meeting on the transaction will take place within the next month. 

Upon announcement of the deal, the company noted that shareholders who hold interests in ordinary shares representing, in aggregate, approximately 34.38% of the entire issued share capital of Playtech have “irrevocably undertaken to vote” in favour.

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The global gambling operator has stated that the acquisition fully aligns with its strategy to “invest in leadership positions in international markets”, while Playtech has described the valuation of Snaitech as “attractive”.

Flutter anticipates the transaction to close by the second quarter of 2025 and it is expected to be immediately accretive to earnings per share.

Flutter eyes top spot in Italy

Snai is one of the top three online operators in Italy with a 9.9% market share and has the number two position in retail share in both betting at 19% and gaming at 14%. In the financial year 2023, Snai generated revenue of €947m and adjusted EBITDA of €256m, of which 50% was generated online.

Flutter expects to assume “the gold medal position” in the country once the deal is completed, with around 30% online share when combined with its existing Italian business.

Sisal, the company’s existing Italian brand, has seen growth across AMPs and revenue at a compound rate of 27% and 17% respectively between Q2 2022 and Q2 2024, resulting in 270bps online share gain. Flutter credits this performance to strong local execution alongside the benefits of Flutter Edge, which it expects to replicate with Snai. 

This also isn’t the only acquisition Flutter has announced recently, as last week, the group reported acquiring an initial 56% stake in NSX Group, a Brazilian operator whose brands include Betnacional, to create a new business in the region called Flutter Brazil.

“I am delighted to announce the acquisition of Snai, one of the leading players in Italy, Europe’s largest regulated market,” commented Peter Jackson, CEO of Flutter Entertainment.

“This transaction is compelling strategically and financially. It fits perfectly within our strategy for value-creating M&A and creates a significant opportunity to accelerate Snai’s growth by providing them with access to Flutter’s market-leading products and capabilities both in the US and globally.

“I look forward to welcoming the Snai team to the Flutter Group and working with them to maximise the growth opportunity for our combined businesses.”

Online growth possibilities

Flutter outlined three areas in which the acquisition of Snaitech will create shareholder value:

• Delivering an enhanced competitive position in a fast-growing, regulated market
• Enhancing its “local hero” brand portfolio
• Opportunities to drive both cost and revenue synergies through access to the Flutter Edge, and deliver meaningful value creation

Regarding delivering an enhanced competitive position in the Italian market, Flutter noted that while online penetration is only at 21% of the market’s €21bn GGR in 2023 in comparison to more mature markets, “greater digital adoption is expected to drive online market growth at a compound rate of approximately 10% over the next three years”.

The group also highlighted that local advertising restrictions and the prevalence of online deposits/withdrawals via retail outlets provide “omni-channel operators with an opportunity to maximise growth”.

As for enhancing the “local hero” brand portfolio, Flutter spotlighted Snai’s retail presence as the “third most recognised brand in a market with restricted advertising”, stating that it compliments its Sisal brand.

The company stated: “We will continue to run a multi-brand strategy in the market Snai’s customers who utilise both online and retail channels are more loyal, more active and generate more revenue per player than online-only players.

“This increasingly diversified retail footprint will give Flutter access to increased omni-channel customer acquisition opportunities to capitalise on online growth.”

Regarding Flutter Edge-powered synergies and value creation, the group expects the transaction to generate “at least €70m” in operating cost synergies through the integration of technology, content and third-party procurement, along with incremental revenue synergies. 

This is expected to be achieved three years post-transaction completion – 10% in year one and 50% in year two – with a cost of 1.25x.

“It fits perfectly within our strategy for value-creating M&A and creates a significant opportunity to accelerate Snai’s growth by providing them with access to Flutter’s market-leading products and capabilities both in the US and globally.”

Peter Jackson, CEO of Flutter Entertainment

Flutter noted that revenue synergies will be accomplished by giving Flutter Edge access to Snai, across “pricing and risk management, in-house casino content and leveraging Flutter technology platforms, materially enhancing the customer experience for Snai customers”.

On a post-cost synergy basis, Flutter expects the transaction to be at a similarly attractive multiple to the Sisal transaction, as well as being “comfortably above” its internal returns criteria by year two.

“Flutter has consistently delivered material revenue synergies to acquired businesses as demonstrated by the compound revenue growth rates of 17% and 19% for Sisal and tombola respectively between Q2 2022 and Q2 2024.”

In addition, the group stated that capital expenditure synergies are expected to be €10m. Subject to merger control clearance and other customary regulatory clearances, the transaction is expected to close by Q2 2025.

Flutter added that the transaction is consistent with its strategy and an example of it continuing to allocate capital towards driving shareholder value creation.

Following the completion of the deal, the company expects its leverage ratio – 2.6x as of 30 June 2024 with $5.5bn in net debt – to “increase but then reduce rapidly given the highly visible profitable growth opportunities that exist across the Group”. 

It also stated that it remains committed to its medium-term leverage ratio of 2.0-2.5x, which “allows flexibility” for the pursuit of value-creating acquisitions.

Flutter will provide additional details of the acquisition during its upcoming Investor Day on 25 September, where it expects to talk about the potential of medium-term organic growth and cash generation, as well as possible capital allocation opportunities.

Unlocking capital for Playtech

As for Playtech, the provider stated that following the transaction’s completion, it will be focusing on its “technology-led offering in high-growth B2B gambling markets with an accelerated growth plan and an extensive portfolio of strategic ventures”.

In addition, the transaction has been described as unlocking “significant capital” and is in line with the board’s stated strategy to maximise value for shareholders. 

Once practicable to do so following the transaction’s completion, Playtech intends to return €1.7bn to €1.8bn to shareholders, with the final amount to be determined with reference to the ongoing business’ capital needs.

In addition, the company will repay amounts outstanding on its bond of €350m due March 2026, “significantly strengthening” its balance sheet.

Playtech sale of Snaitech to Flutter follows the company’s recent announcement that it had amended its strategic agreement with Caliente’s Caliplay, resulting in the company receiving over €150m in unpaid software and service fees with plans in place to dismiss its legal proceedings once the revised arrangements come into effect.

Mor Weizer, CEO at Playtech, added: “Under the Playtech Group’s ownership, Snaitech has grown into a high-quality business with a leading position in the Italian sports betting and gaming market. The business has an experienced and high-performing management team that has fully embraced the post-lockdown shift to omni-channel in Italy. 

“Today, Snaitech has an established retail presence and online business that are both well-placed to continue their success in one of the most attractive markets in Europe.

“While Snaitech has been an important part of the Playtech Group’s growth in recent years, the Board agreed that this transaction represents a compelling opportunity to maximise value for our shareholders while also allowing them to share in further upside from continued ownership of a leading B2B business. 

Weizer continued: “The combination of the Playtech Group’s leading technology with its exposure to attractive markets, including in the Americas and Europe, provides a strong platform for growth in the medium-term. We are excited about what the future holds and the many opportunities ahead of us.

“In Flutter, Snaitech will have a new owner with an existing presence in Italy and all of the opportunities that brings. I’m confident that Snaitech will continue to excel under their ownership.”

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Playtech issued a brief statement following significant media speculation on the potential sale of its Italian business to Flutter.

The statement emphasised that discussions are ongoing “regarding the potential sale of the Snaitech business for a value that could be about £2bn.”

Playtech granted Flutter a period of exclusivity to complete due diligence and necessary terms to pursue a deal with investors.

As it stands, Playtech’s board has not sanctioned any approach by Flutter, and “there can be no certainty that any transaction regarding the potential sale of the Snaitech business will ultimately be agreed upon, or as to its terms. Further announcements will be made as and when appropriate.”

Flutter responded by emphasising that at this stage there is no certainty that Flutter will proceed with an acquisition, adding it will provide an update as appropriate.

It would build on Flutter’s ambitions for expansion into the Italian market to expand its International unit (non-US and UK), which in 2022 acquired Italian lotto and retail betting giant SISAL for €1.9bn.

The acquisition of Snaitech would be transformative for Italian gambling, merging the market’s second and third largest gambling groups under Flutter International’s domain.

Published yesterday, Flutter’s Q2 accounts registered International Unit revenues of $807m (+11%), combined with EBITDA results of $156m.

Setting out ambitions for growth in the future, the firm’s CEO Peter Jackson underlined that ‘if necessary, we will go beyond our leverage targets to do a deal’ when it comes to market expansion.

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The spike was significantly bolstered by the strength of the firm’s B2C output and its growth within the Italian market. 

Continuing to cement its position as a leader in the region, Snaitech Italia landed revenues of €949m (FY2022: €899m) and an adjusted EBITDA of €256m (FY2022: €244m).

Further underlining the versatility of Playtech’s revenue and growth, the results also detailed how the group expanded its US market igaming B2B services – bolstered by 11 licences within the US.

Nonetheless, in Latin America there remains a level of uncertainty over the case involving Caliplay, which continues to rumble on.

The disagreement over the firm’s Mexican igaming licence will unfold in October when the case returns to court. However, it is something that could impact Playtech’s end of year results. 

Chairman Brian Mattingley stated: “I would like to take this opportunity to thank the Executive Management team, who continue to demonstrate their agility and resilience in navigating a challenging external backdrop, given the ongoing wars in Ukraine and the Middle East. 

“Playtech has built on the strong strategic and operational progress of recent years and continues to cement its leadership across both B2B and B2C sectors. While there were many challenges in 2023, the consistent quality at the core of our business meant that we were able to upgrade our expectations during the year and deliver a strong financial performance.”

Underlining a successful period for the group, Playtech confirmed a near three-fold increase in post-tax profits to €105m, matched against FY2022 profits of €40m.

Group CEO, Mor Weizer, commented on the results: “Playtech performed very strongly over the year and delivered Adjusted EBITDA up 9 per cent to €432m, ahead of previously raised expectations.”

“As well as delivering excellent financial results, the Group made important strategic and operational progress, including our expansion across the US. 

“Our B2C division delivered revenues exceeding €1bn for the first time, and Snaitech remains well positioned to benefit from the under-penetration of the online segment, given the strength of the brand, the continuous improvements to apps and technology, and a broadening of its content offering.”

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Despite expecting growth rates to slow later in the year, the “strong growth” of both Snaitech and Caliente is anticipated to lead to adjusted EBITDA through the entirety of 2023 to be “slightly ahead of current consensus expectations”.

Regarding the former of those aforementioned segments, progress is reported as being maintained “very well” through the first four months of the year.

In addition to a Latin American expansion being advanced by Caliente, with Mexico singled out as a particular high point, strategic progress is also reported across the US.

“The strategically important live casino business continues to capitalise on the market’s rapid expansion, delivering good growth in the period,” a trading update issued by the group said.

“Momentum also continued within the higher margin SaaS business with very strong revenue growth, further launches and new customer signings.”

On the B2C front, online is reported as demonstrating “good growth,” with Snaitech maintaining its momentum, while the resumption of football after the World Cup brought a widespread uplift.

“I am delighted to report that our strong start to the year has continued, with growth across both the B2B and B2C divisions,” Mor Weizer, Playtech CEO, said.

“Our strategy of focusing on regulated or soon-to-be regulated markets, combined with Snaitech’s impressive performance in Italy, means we remain well-positioned to make further progress and capitalise on the significant growth opportunities ahead.” 

As previously alluded to, Playtech noted a “strong start” to the current year during a FY2022 breakdown that was disclosed earlier in the year, with Snaitech and Caliente highlighted as being “consistent with the structural growth drivers within the industry.”

The gambling group’s board expects momentum to be continued, with confidence stressed in Playtech’s ability to execute on opportunities across both B2B and B2C divisions over the medium term. 

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This has seen the online casino games developer strengthen its position in the Italian market, with its range of igaming titles to be integrated with the sports betting and online casino operator. 

Snaitech, which Habanero praises as “one of Europe’s most exciting and diverse gaming enterprises,” has subsequently gained games such as Egyptian Dreams, Four Divine Beasts and Presto, for its Snai.it online gaming entity.

Alessandro Graziosi, digital director at Snaitech, noted: “We have been impressed with the superb quality of Habanero’s titles for some time and we are excited to be hosting the supplier’s content on Snai.it. 

“We hope this is the start of a long and successful relationship with one of Europe’s foremost suppliers.” 

The agreement is said to represent a “crucial step in the right direction” for Habanero, which has asserted an aim of maintaining its growth strategy across the European market and beyond through the coming 12 months. 

“This deal is further testament to Habanero’s strength and reputation as a games supplier, as we continue to attract business from leading operators from across the globe,” stated Arcangelo Lonoce, head of business development Europe at Habanero.

“We are thrilled that Snaitech has chosen to partner with us, and we look forward to a long and prosperous collaboration.”

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The Playtech board is unanimously recommending shareholders vote in favour of the deal in a year that has seen an unprecedented level of M&A activity. Aristocrat plans to fund the deal with a £864m equity raising, alongside new debt and existing cash.

Aristocrat believes the deal will provide material scale in online gaming, provide revenue growth, reach a broader range of customers and ‘operate and innovate’ in the European market through Playtech’s Snaitech B2C operation.

Aristocrat CEO and managing director Trevor Croker explained: “The proposed combination would bring together Aristocrat’s world-class gaming content and customer and regulatory relationships with Playtech’s industry leading global online RMG (real money gaming) platform (B2B) and European B2C footprint.

“The combined group would offer a broad portfolio of end-to-end solutions for gaming customers around the world, as well as seamless player experiences, underpinned by a shared focus on responsible gameplay and innovation.

“Additionally, the business will be ideally positioned to unlock sustainable shareholder value by seizing opportunities in the fast-growing global online RMG segment as they continue to open up, particularly in North America.”

Croker said that the offer reflects the strategic potential of the merger in the global sector that continues to migrate online. “Adding Playtech’s talented team with Aristocrat’s established strengths and momentum will create a true industry leader in the global online RMG space, particularly in terms of our B2B capabilities.”

The offer represents a valuation multiple of 11.4x Playtech’s adjusted EBITDA for the 12 months to 30 June 2021 and Aristocrat has already made deals with major shareholders for just over 20 per cent of Playtech’s outstanding shares.

Mor Weizer, CEO of Playtech, said of the transaction: “This transaction marks an exciting opportunity in the next stage of growth for Playtech, and delivers significant benefits to our stakeholders, including our customers, our shareholders and our incredibly talented people. This deal has the potential to enhance our distribution, our capacity to build new and deeper relationships with partners, and bolsters our technological capabilities.

“The combination of our two companies builds one of the largest B2B gaming platforms in the world, with the people, infrastructure and expertise to provide our customers with a truly best-in-class offer across all areas of gaming and sports betting.”

Brian Mattingley, chair of Playtech, added: “In recent years, Playtech has successfully repositioned its world leading gambling technology and operations, expanding in strategically important regulated markets and driving major online B2B revenue growth.

“Whilst the business has made significant progress, most notably in the Americas, Aristocrat’s proposal provides an attractive opportunity for shareholders to accelerate Playtech’s longer-term value.

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On the first day of SBC Digital Italia Summit, this topic was discussed more in depth through the eyes of leaders within the region’s igaming sector on a panel entitled ‘The sustainable future of gaming’ – moderated by Giancarlo Loquenzi, journalist at RAI Radio 1.

Kickstarting the conversation on balance within sustainability, Guglielmo Angelozzi, CEO at Lottomatica Group, emphasised that it is a “complex problem but also a critical one” where companies need to find a balance between all of the “interests and needs.” 

He continued: “I think that the most important variables in order to find a balance, in order of priority, is first of all, guaranteeing safety for the product offering for customer protection and fighting illegality. This question has been open for a long time and we should not ignore it. There’s some ethical aspect to take into consideration and this needs to be mentioned and discussed.

“We need to recognise this problem exists and we need to protect the customers interest. In my opinion these are the two main variables and the pandemic highlighted this. We have an explosion of illegal games, four million Italians, according to a study from ipso, who have used these products.”

Yet, whilst Angelozzi referenced the customer protection, Markus Buechele, CEO at Novomatic Italia, stressed that technology is key when discussing the future of sustainability, pinpointing its importance for the future of gaming and rule implementation. 

“Technology is important for the user and we are producing games for the legal channel,” added Buechele. “We have assessed the importance of the Italian market. We have modern and transparent regulations and we have longer periods of market stability. 

“We have to meet the market demand and try to satisfy this demand for technology development and this requires investment in RND. The development of technology gives a positive contribution to stability and enables us to find balance.  

“I think investing in technology will be the key for the future because it will certainly give us a high safety level for the people and consumers and the state. 

“We use our technology exclusively for the legal gaming sector and it’s important to focus on innovation and development of technology because only the reliability of the technological platforms can guarantee certainty for identifying illegal activities.”

Whilst both Buechele and Angelozzi highlighted areas for balance and focus for the Italian market, Francesco Durante, CEO at Sisal, reiterated the importance of legal gaming within Italy and, while acknowledging there are problems, is “convinced the sector is the solution and not the problem”.

He noted: “With regards to sustainable business models protecting the players, but also the occupation, we have to change our approach to reaffirm our commitment to player protection. This will be the main challenge for the sector in 10 years. 

“The Italian model has already been a point of reference over the world and this is also thanks to the investment made by companies that obtain authorisation for legal gaming. Yet, this is no longer sufficient and now we have to go from a compliance approach to a commitment approach. 

“It’s not sufficient to just adhere to international standards and rules but we need to focus on the user and invest more on technology, information and communication in order to give a contribution to the culture of the games so it can be balanced in order to prevent problems and protect vulnerable users. 

“In the next 10 years, we would like to concentrate our investments until we are convinced we have reached our objective which is zero problem users in Italy.” 

Moving forward, Loquenzi cast the panel’s attention to the future and asked how the Italian sector can spread more awareness about the legal market so all the money generated can be used for charitable purposes.

Addressing the question, Fabio Schiavolin, CEO of Snaitech, noted that the ban on publicity hinders the gaming sector whilst being a “boomerang” for sports which has “created a loss in productivity” in the sports supply chain in comparison to football teams outside of Italy who “keep receiving profits from the gaming industry”.

He continued: “I believe that the lack of communication actually takes awareness away from us. It doesn’t help to communicate and interact with the negative perception that the public has towards the gaming sector. 

“Communication should step forward. This industry has grown incredibly in the past few years. I’ve seen that in the quality of the managers and CEOs, so the awareness of what we are is a clear fact. Internally, we need to be able to take it outside.” 

Register for a free ticket to SBC Digital Italia, taking place from July 28-29, by clicking here.

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From political pressure and the possible tightening of regulations, to the post-COVID reshaping of Italy’s retail sector and how to handle the rapid growth of online gaming, there are numerous challenges for the Italian industry’s key players to discuss. 

The online event on July 28-29 will bring together more than 1,250 delegates to hear a selection of renowned experts from the gambling industry, politics, law enforcement, professional sports, and the media share information and exchange ideas about how to tackle those important issues. 

The confirmed speakers include Fabio Schiavolin (CEO, Snaitech), Francesco Durante (CEO, Sisal), Markus Buechele (CEO, Novomatic Italia), Marcello Minenna (director, ADM), Roberto Ribaudo (director, Interpol Italia Division), Carla Ramella (director of customs and monopoly – central public administration, Sogei), Claudio Durigon (undersecretary, Ministry of Economy & Finance), and Ugo Taucer (attorney general, Italian National Olympic Committee). 

Day one’s agenda includes a session examining what is possibly the biggest challenge faced by the industry: the proposed changes to the licensing regime and the possibility of the government ordering a complete overhaul of gambling regulation. 

The heavyweight programme also features a panel of CEOs from major companies debating how to create a more sustainable future for the industry in Italy, along with a session that will detail the changes the country’s vast retail gambling sector needs to implement to aid its recovery from the financial hit of the pandemic.

Concluding the opening day’s agenda is a session that focuses on the latest marketing strategies and technology, and a panel about Italy’s leading role in the battle against match-fixing in international sport. 

On day two, attention will turn to the online market, with an examination of how the online gaming sector can build on the growth in player numbers and revenue it has enjoyed over the past year, an in-depth look at the potential of esports betting, and an assessment of the future of the Italian poker industry. 

The event will conclude with a panel about the role of gambling regulators in the international industry, complete with examples of best practice from around the world. 

Rasmus Sojmark, founder and CEO of SBC, said: “SBC Digital Italia comes at a crucial time for the Italian betting and gaming industry, and the event will provide an invaluable forum in which to share important information and discuss ideas about the major challenges it faces.

“With the help of the in-depth local market knowledge of the team at our partner, Gioco News, we have compiled an agenda packed with topical sessions and a speaker line-up that will deliver vital insights for the audience.”

In addition to the conference, SBC Digital Italia will feature a virtual exhibition with 20 leading suppliers showcasing their latest innovations tailored for the Italian market, and a selection of networking opportunities.

Register for your free online pass for SBC Digital Italia at the event’s website.

The post Agenda published for SBC Digital Italia betting and gaming conference appeared first on CasinoBeats.

Taking part in the Microgame sponsored session entitled ‘Wake-up call: igaming’s time to rise?’ at yesterday’s SBC Digital Italy, Nicola Tani, editor at Agipro News and moderator for the day, looked at whether the surge was merely a consequence of a pandemic which was depressed of a sports betting market, or if it is set to be Italy’s dominant online force.  

Noting that casino games revenue has grown for the eighth consecutive year, with the latest growth showing an increase of 46 per cent in 2020, Tani asked Marco Castaldo, CEO of Microgame, if this new trend is unstoppable and why the product is so successful in Italy.

Castaldo noted that he was unsure if it was unstoppable but was ‘sure’ that it was ‘not going to go away’. He commented: “I think we are seeing an acceleration of an underlying trend that was there in place for some time. I think it’s important to remember that in Italy, the online gaming penetration has been historically quite low. 

“For example, the year pre-pandemic, 2019, online gaming penetration overall was 9.5 per cent against the EU average of 23 per cent. Penetration was growing steadily before the pandemic and it was growing due to the usual drivers that we all know; technology, technological trends and demographic trends.”

Castaldo went on to pinpoint that Italy was being held back by its importance of the retail experience for the players, compared to other countries, along with the history of the Italian land-based gaming industry. 

“Before the pandemic, there was another factor that is important to remember that there was considerable regulatory pressure on retail gambling because of various regional and local regulations, effectively reducing the supply of land-based gaming,” he continued.   

“So we had an uptick in growth of the penetration of online before the pandemic but of course the pandemic has accelerated everything. Growth will continue because what we are seeing now is what I call the ‘first order effect’, people with more time at home and players who have signed up for online accounts because they can’t go to their betting shops.

“The real underlying effect which will make this growth continue is that it’s an industry-wide shift that is now going to accelerate from a retail only strategy for many to a multi-channel strategy. This is going to fuel the growth for online, online casinos in particular, for years to come.”

Joining Tani and Castaldo on the panel was Alessandro Allara, chief digital officer at Gamenet Group, Natalie Berenato, head of online marketing at OlyBet and Alessandro Graziosi, digital director of Snaitech.

Allara provided a different perspective from the overall market figures, noting that his company was seeing an even ‘higher’ acceleration in the last two years. 

“For us, 2020 versus 2018 has seen a 147 per cent increase, a dramatic boost,” claimed Allara. “Excluding the pandemics effect, there are reasons why we can expect the market to grow… Fun bonuses is something that’s been proposed to the user in the last few months/years while in the UK for example, this is a more consolidated marketing strategy. 

“It’s something that is growing from an organic point of view while also the international operators are tailoring their products more to the local market. My expectation is that 2021 will keep growing. We’ve seen that January is an astonishing month with a 100 per cent growth vs 2020.”

The panel went on to discuss the transition of players from land-based slots to the online sector, with Berenato addressing the importance of cross-selling during the last 12 months.

“It’s fine getting the players through the door, which my colleagues said has been growing, it did help with the acceleration but it’s not just about having players signing up, it’s also all the work that goes behind it, the communication between the land-based and online staff,” it was noted.

“I believe it’s important for the players to experience the loyalty from the land-based/retail will carry on online and they are not just a number. 

“I think that the gaming industry is now catching up with the other e-commerce strategies, with companies out there that we kept admiring but we never really took onboard the technology on targeting and cross-selling as some of the other non-gaming e-commerce sites are doing. We had the technology we just never really utilised it well until we learned that it was necessary, especially in Italy where we were lagging a little behind.”

Tani then shifted the conversation towards online poker, which during the lockdown has grown above €200m in GGR. Tani pressed on if the growth of poker is down to the pandemic itself, or if it is something that has been growing steadily in the background. 

“I think this is going to be mostly temporary. Having said that, for us, poker never died,” Castaldo continued.

“Poker for the player, must be a form of entertainment and social context and not a source of money. For the operator, it’s an acquisition and a cross-selling tool. It’s not a way to make money. 

“Poker represents about eight per cent of the industry GGR. In terms of numbers of players, on our side but also industry-wide as it’s not so different, is 33 per cent of players play poker. The share of GGR is not the important thing, it’s the share of participation.”

Continuing on the same theme, Castaldo went on to passionately discuss the concept of international liquidity within online poker, noting that it is based on a ‘bad assumption’.

“It’s based on the historic assumption that has ruined poker, that the mission of poker is to provide large winnings,” it was concluded.                                     

“I think, being controversial, international liquidity is really the only necessary strategy for a very limited number of operators who are looking to optimise an old poker strategy which I don’t think is good for the business.” 

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