Following the good news of new product releases this month including the Top Gun branded Video Slot and Live Prestige Roulette, Playtech ends the month on a sour note. After discussions with the Financial Conduct Authority (FCA), Playtech will not move forward with its £459 million ($700 million) acquisition of spread betting company Plus500 as it will not be able to meet specific FCA requirements by the deadline of December 31, 2015.
According to a statement from Playtech: “Whilst regulatory approval for the acquisition of Plus500 has already been received from the Cyprus Securities Exchange Commission, the Company has been in active dialogue with the Financial Conduct Authority ("FCA") in relation to its proposed acquisition of Plus500, including in relation to certain concerns raised by the FCA which the Company considered could be resolved to the satisfaction of the FCA prior to 31 December 2015, being the effective long-stop date for the transaction to complete.”
“However, following an update from the FCA late in the afternoon of Friday 20 November 2015 and having considered its position over the weekend, the Board of Playtech is now of the view that the steps being proposed to address these concerns will not sufficiently satisfy the FCA to enable Playtech to obtain the FCA's approval by 31 December 2015, and is therefore withdrawing its change of control application to the FCA.”
There are no financial penalties involved with terminating the acquisition deal for Playtech but the planned merger with Ava Trade is an area of concern as the company believes that the termination of its merger talks with Plus500 will make Ava Trade sellers more likely to invoke their termination right based on the Central Bank of Ireland’s opposition to the sale back in October. Should this deal be terminated, Playtech stands to lose its $5 million deposit.
In its statement Playtech also provided an update on Ava Trade stating “Playtech continues to appeal the CBI's decision to oppose its application to acquire Ava Trade.”
Read the full update: Source