Merger To Create Australia's Largest Gambling FirmCombined Company To Be Worth $11 Billion |
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Two of Australia’s largest gambling companies announced Wednesday that they will merge in a deal to form a combined company worth more than $11 billion.
Tabcorp, a racecourse-betting powerhouse, and lottery behemoth Tatts said the merger will generate $130 million in saved costs in a “rapidly changing [betting] landscape.”
Tabcorp will pay $4.9 billion for Tatts, the companies said. The merger is expected to be completed by the middle of next year, depending on shareholder and regulatory approval.
Tatts’ Chairman, Harry Boon, said in a statement: “The combination of Tabcorp and Tatts is based on clear industrial logic and a strong and tangible synergy proposition. It comes at a time of escalating competition from new business models and rapid consolidation of gaming and wagering companies globally.”
In the online gambling industry, about $14 billion in mergers and acquisitions has occurred over the past two years alone, according to Bloomberg.
Australia’s gambling market grew six percent in 2015 to about $17.4 billion (A$24.1 billion). Thanks to a population of roughly 23 million, Australians spend more on gambling than people anywhere else in the world.
An estimated 80 percent of Australians gamble in some form, also the highest rate in the world. Gambling represents 1.2 percent of Australia’s GDP.
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