Kindred Group is reportedly trying to promote itself. However the Swedish gaming firm could have been rebuffed by some marquee names, together with non-public fairness giants and European sportsbook operators.
The Unibet operator mulling a sale may very well be the results of Keith Meister’s Corvex Administration urging the corporate to take action. Meister’s hedge fund took a stake in Kindred earlier this yr, rapidly doubling it to 10.12% within the second quarter, giving it the cache essential to push for a reorganization or sale.
Studies point out Kindred approached European rivals 888 Holdings, Entain Plc (OTC:GMVHY) and German sportsbook operator Tipico. It additionally spoke to personal fairness corporations Apollo International Administration (NYSE:APO) and Blackstone (NYSE:BX) concerning a transaction.
Kindred’s market capitalization at present hovers round $1.72 billion, making it simply digestible for any of the aforementioned potential suitors. However these corporations reportedly declined to advance talks on the idea that the Swedish firm must freshen its method to working in regulated markets.
Kindred European Outlook
Any purchaser contemplating shifting on Kindred could be betting on Europe, which is dwelling to one of many largest, most mature gaming markets on the earth.
“We’ve got an thrilling interval forward of us with the Dutch market up and working, the continued growth of our proprietary sportsbook, and never least the 2022 World Cup happening in November and December. We additionally anticipate the headwinds skilled throughout previous quarters to progressively ease off within the coming quarters,” stated CEO Henrik Tjärnström in an announcement.
Kindred’s European publicity may very well be enticing to a suitor corresponding to 888 Holdings, which just lately acquired William Hill’s worldwide property. Or it may flip to Entain, if that firm is trying so as to add share in markets through which it’s already established. For its half, Apollo owns some European gaming property and has beforehand been rumored to be a suitor for others.
Subsequent Steps for Corvex, Kindred
Assuming Kindred will not be profitable in figuring out a purchaser and executing such a transaction, it stays to be seen how Corvex will proceed. However Meister’s hedge fund has a observe document of affecting different types of change at corporations through which it invests, together with gaming entities.
Corvex is an activist investor, that means that when the agency takes fairness stakes in corporations, it often pushes for some type of change. That may be within the type of asset gross sales, spinoffs, elevated shareholder rewards, or different concepts.
Meister’s agency has documented success within the gaming trade, having joined the board of MGM Resorts Worldwide (NYSE:MGM). He was among the many traders that pushed the gaming firm to generate money by divesting its actual property property. The hedge fund was profitable in that goal, and it culminated in MGM Development Properties (NYSE:MGP) — MGM’s major landlord — being acquired by VICI Properties (NYSE:VICI).