Flutter Entertainment to Buy 56% of Brazil's NSX Group for $350 Million — Update

By Ian Walker

Flutter Entertainment is creating a new Brazilian business as part of its strategy to invest in leadership positions in international markets and drive shareholder value creation.

The parent company of FanDuel, Betfair and other gaming and gambling brands said Friday that it is buying a 56% stake in Brazil's NSX Group for $350 million. It will also contribute Betfair Brazil in exchange for a 56% stake in the new business--Flutter Brazil.

Flutter said it expects the deal to close in the second quarter of next year, conditional upon the usual regulatory clearances.

Flutter said it would be able to increase its shareholding in Flutter Brazil through a put and call option arrangement in year five and ten after the completion of the initial deal.

"We believe that combining the extensive local expertise of the NSX team, our existing Betfair business and the power of the Flutter Edge, will create a compelling opportunity to capitalize on the growth opportunity in Brazil which presents an exciting runway of future growth," Chief Executive Peter Jackson said.

NSX, which has a portfolio of brands including Betnacional, is expected to generate $256 million of revenue and adjusted earnings before interest, taxes, depreciation and amortization of approximately $34 million in 2024, Flutter said.

Betfair Brazil is currently delivering strong growth and forecast to generate revenue of $70 million this year, the company said.

It added that the company plans to invest in the business to drive market share growth in the region and that this will result in an adjusted Ebitda loss of between $90 million and $100 million for Flutter Brazil next year.

"The transaction is consistent with our strategy and is another example of Flutter allocating capital to drive shareholder value creation," the company said Friday.

Write to Ian Walker at ian.walker@wsj.com

(END) Dow Jones Newswires

September 13, 2024 03:17 ET (07:17 GMT)

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