The rival gaming operators fighting for control of Casinos Austria have decided to join forces and fight to expand the business.
On Friday, Austrian gaming technology outfit Novomatic Group and the Czech investors behind KKCG and Emma Capital announced the formation of a joint venture that will control 51% of Casinos Austria and its Austrian Lotteries subsidiary. The Austrian government retains its one-third stake in the unlisted gaming firm.
A fight for control of Casinos Austria kicked off in earnest last year after Novomatic made a play to boost its roughly 40% stake to majority territory by acquiring the 16.8% stake held by a third party. The Czechs objected, claiming that their 11.8% stake in Casinos Austria gave them right of first refusal if any other stakeholders opted to sell. Cue much public posturing and threats to unleash hell and/or lawyers.
But the parties dropped their daggers on Friday, announcing that they had agreed to a ‘strategic partnership of equals’ that would focus on expanding the business so that everyone’s stake was worth more. The parties declined to offer specifics on what steps the Czech group would have to take in order to bring their holdings in line with the Novomatic camp.
The Czechs will reportedly handle Casinos Austria’s lotteries and sports betting operations – reflecting their experience running the Sazka group of companies in Eastern Europe and the OPAP betting/lottery business in Greece – while Novomatic will handle the land-based casino and online operations.
The deal still requires the approval of Austrian gaming regulators but appears to have received the blessing of the country’s finance minister, who had urged the parties to resolve their difference quickly so that the business could go back to printing money (a profit of €41.7m in 2014 on revenue of €3.6b).
Novomatic CEO Harald Neumann said the deal was a no-brainer given that the parties had “been friends before yesterday.” Neumann said the plan now was to “reach a common understanding” with the Casinos Austria shareholders not party to the deal.