Kindred will pay 196 pence a share for the owner of the Roxy Palace online casino brand, 16 percent above the latest closing price for 32Red, whose shares had surged in the last three weeks on takeover speculation.
The takeover continues a surge of merger-and-acquisition activity across the gaming sector, where companies need additional scale to meet an increasing burden of tax and regulation.
"At first glance, this deal does seem to make strategic and financial sense,” David Jennings, an analyst at Davy Stockbrokers, said in a note. "We expect to see further consolidation in the gaming space this year based around the same types of motive that have driven this deal, namely scope to build scale, diversify regulatory risk and improve efficiency.”
Source: GMB / bloomberg.com
