FDJ said it was offering 130 Swedish crowns (US$ 12.43) a share for Kindred, which would correspond to an enterprise value of US$ 2.83 billion and represent a premium of 24% to Kindred Group's January 19 closing price.
Kindred shares were up roughly 17% to 122.6 crowns while FDJ's stock traded 3.9% higher in early trading.
Kindred had attracted interest from "several parties" since it started a review of strategic alternatives last year, including a possible merger or sale of the company, the Swedish firm said in a separate statement.
The offer from FDJ represented the "most attractive outcome for shareholders", prompting Kindred's board to unanimously recommend the offer.
"The Board believes that the terms of the offer recognise Kindred's long-term growth prospects, taking into account the risks and uncertainties associated with the realisation of those prospects," it added.
"I am pleased to announce today the proposed acquisition of Kindred," said FDJ Chairwoman and CEO Stephane Pallez.
"The combination will result in a stronger strategic positioning and significant value creation for the benefit of our shareholders and broader stakeholder," she added.
FDJ, which offers lottery scratch cards in France and in which the French state holds a stake of 20%, said the takeover of Kindred Group would boost its earnings and result in an accretion of more than 10% in its dividend per share.
In its own statement, FDJ said the deal would create the second largest operator in Europe’s gaming sector. It added the combination would result in a “European gaming champion” with stronger revenue and earnings growth.
Nils Andén, CEO of Kindred, also spoke positively about the proposal. He said that the combination would benefit both businesses and support growth moving forward.
“I’m delighted with today’s transaction announcement between FDJ and Kindred, creating a leading European gaming operator with the financial and strategic capabilities to further expand its global footprint,” Andén said.
“I believe that combining with FDJ, Kindred can accelerate the delivery of long-term strategic projects, continue to grow in core markets and provide a trusted source of entertainment to customers. It will also speed up our path towards 100% locally regulated revenue".
“I’m excited to bring Kindred’s extensive experience and know-how into FDJ’s organisation, contributing to the development of a leading online gaming business. I’m also very proud that FDJ acknowledges and values the skilled employees and strong assets within Kindred.”
Source: GMB / Reuters / iGB
