GVC Holdings looks like it’s doing a little bit of housekeeping in Spain. SBC News reports the operator will be selling off its stake in the Sportium sports betting joint venture to Grupo Cirsa for €70 million ($78.5 million), but that won’t result in too much change when it comes down to it.
To explain the deal, GVC Group CEO Kenneth Alexander said:
“GVC is one of the leading online gaming operators in Spain with bwin and the disposal of our interest in Sportium enables us to simplify our business in this market. We have enjoyed a good working relationship with Cirsa and are pleased to be able to support them through a new B2B partnership.”
That’s a great explanation for what’s happening, but doesn’t really tell the full tale. Sportium JV was created as a joint-venture between Ladbrokes and Cirsa in 2013, with 50/50 ownership for each. When GVC bought out Ladbrokes in 2018 that altered the joint-venture deal, causing Cirsa to complaint to the courts that GVC should sell its interest.
So what we have here is GVC effectively giving Cirsa what it wants rather than face legal battles. But GVC doesn’t leave the deal without maintaining friendly ties. Reports note that GVC will stay on as a B2B supplier, and maintain an interest through its ownership of Ladbrokes.
GVC also updated investors on the current state of Sportium. They cited a contribution of £2.5 million ($3.12 million) to Group proforma operating profits for the year.
This news comes just a day after GVC reported it experienced modest revenue gains in the first half of 2019. While the operator experienced a serious hit to their retail operations due to new maximum limits on fixed-odds betting terminals in the U.K., digital operations, which the company promises to focus on in Spain after its exit from Sportium, helped save the first six months of the year with a 16% increase year over year.