UK’s Sky said it has sold off 20% of its stake in Sky Betting & Games to Canada’s The Stars Group.
The Stars Group is a Canadian company listed on both the Toronto and Nasdaq stock exchanges, which specialises in online gaming.
This disposal follows the initial sale of Sky’s majority stake in SBG to CVC Capital Partners in 2015 which, taken together, will crystallise a total value of c.£1.2bn for Sky shareholders.
Today’s transaction will see Sky receive c.£425 million cash and 7.6 million newly issued shares or approximately 3% of The Stars Group post completion of the deal, worth approximately £145m. Sky will use the proceeds to reduce debt and reinvest in further growth opportunities.
Formed by Sky in 2001, SBG grew rapidly to become one of the leading operators in the UK’s online betting and gaming markets, benefiting from a strong partnership with Sky Sports and Sky’s technology and product innovation expertise. After selling 80% to CVC in 2015 Sky continued to work closely with its partners at CVC and the SBG management team to drive the further development of the business. As part of the transaction, Sky will continue to license the Sky Betting & Gaming brand to The Stars Group.
The transaction is part of a transaction under which CVC will sell the whole of its stake in SBG to The Stars Group.
The transaction is subject to customary regulatory clearances.
Jeremy Darroch, Group Chief Executive Officer of Sky, commented:
“We are proud of what we have achieved from a standing start with Sky Betting & Gaming, crystallising over £1 billion in value for shareholders. The ability to create innovative products and successfully challenge for share in completely new markets has become a pattern at Sky and gives us the continued confidence to open up new opportunities and invest for future growth.”
Sky said Lazard is acting as exclusive financial adviser on the transaction.