BUSINESS

Report: Bwin’s Russian-licensed betting site not long for this world

TAGs: Bwin, bwin.ru, GVC Holdings, qiwi, Russia, The Stars Group

russia-bwin-online-betting-site-closingThe Bwin sports betting brand may soon disappear from Russia’s online gambling landscape, according to local reports.

On Thursday, Russian affiliate Bookmaker Ratings reported that A&NN Investments is looking to unload the Russian sports betting license held by Digital Betting LLC, which operates online in Russia using the Bwin.ru domain through a joint venture with UK-listed GVC Holdings.

While no deal has been finalized, a Bookmaker Ratings source claimed that Digital Betting’s license may be transferred to a division of payment processing outfit Qiwi, which handles transactions for multiple Russian-licensed bookmakers. Qiwi has denied this report.

Other sources claimed that The Stars Group (TSG) is in the running to acquire Digital Betting’s license. In August, TSG CEO Rafi Ashkenazi said the company planned to apply for a Russian betting license using its PokerStars Sports brand. PokerStars derives a significant chunk of its revenue from Russia’s online black market but this revenue is under threat from Russia’s payment-blocking efforts.

Bwin.ru is a joint venture of GVC and A&NN, which is owned by Russian billionaire Alexander Mamut, who also controls the Rambler & Co digital media firm. But Bookmaker Ratings’ source claimed the new owner of Digital Betting’s license will ditch the Bwin association in favor of launching a new brand from scratch.

Bwin.ru’s former CEO Dmitry Sergeyev, who jumped ship in May to become CEO of Russian online bookmaker Parimatch, previously stated that he’d discussed potential partnerships with UK online betting giant Bet365 and Flutter Entertainment’s Betfair brand before settling on GVC’s Bwin.

The Bwin.ru site launched two years ago this month but the business has so far failed to match the Bwin brand’s presence in other international betting markets. SimilarWeb data show Bwin.ru tied for 13th in visitor traffic to Russia’s 19 licensed betting sites in September with just 210k visits (market leader Fonbet.ru had 13.86m visits).

While Mamut originally vowed to invest up to €10m per year on marketing to ensure Bwin.ru got off on the right foot, he also expected the site to break even within three years. Bwin.ru reportedly generated revenue of RUB433m (US$6.8m) in 2018 but lost RUB145m due to start-up and marketing costs.

Bwin’s entry into Russia’s regulated online market has yet to be followed by any other Western operators, although Bet365 was rumored to be prepping its own Russian JV, at least, until that weird incident in which Russian authorities found 400kg of cocaine stamped with the company’s logo.

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