Sky is selling a controlling stake in its online betting and gaming business, Sky Betting & Gaming , to CVC Capital Partners in a deal which values Sky Bet at £800 million.
Sky will receive cash of £600 million on completion and further deferred and contingent consideration up to the value of £120 million. The total value of £800 million represents a multiple of approximately 15x EBITDA for the 12 months ended 30 June 2014. Sky will retain an equity stake of approximately 20 per cent in Sky Bet and ongoing board representation. As part of the transaction Sky has also entered into a long-term brand licence agreement with Sky Bet.
The Sky Bet management team, led by Managing Director Richard Flint, will remain with the business under the new ownership structure with all Sky Bet’s employees moving across into the new entity. The business will remain headquartered in Leeds.
Jeremy Darroch, Group Chief Executive of Sky, said: “In the last ten years, we have successfully grown Sky Bet from a start-up to one of the leading online betting and gaming companies in the UK. This transaction will allow us to focus further on the substantial growth opportunities in our core international pay TV business while realising significant value for our shareholders.”
The transaction is expected to close in the first quarter of 2015.
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