888 completes sale of Latvian business to Paf Consulting

Leading online gambling operator 888 has finalized the sale of its Latvian business to Paf Consulting, following an agreement reached just a few weeks ago.

The deal, valued at up to €28.3m, will see Paf pay an initial €24.0m in cash upon completion, with an additional €4.3m scheduled for 2024, subject to the 2023 audited financials.

According to the agreement, the Latvian company, which operates under 888’s William Hill and Mr Green brands with a local license, will be able to continue using these brands in Latvia for a specific period. Despite 888 owning a 90% share in the entity, the Latvian business operates independently with its own management team and technology platform.

Lord Mendelsohn, executive chair of 888, expressed satisfaction with the sale, noting its contribution to the company’s integration program: “This sale generates cash proceeds from a non-core market to support our deleveraging plans, as well as enabling reinvestment into our core and growth markets,” he stated.

Significant changes

The year 2023 has seen significant changes within 888, starting with the departure of former chief executive Itai Pazner in January. This move followed the company’s disclosure of anti-money laundering (AML) and know-your-customer (KYC) process failings in the Middle East. Lord Mendelsohn continues to serve as interim executive chair while the search for a permanent replacement is ongoing.

In July of last year, 888 successfully acquired William Hill’s non-US assets from Caesars for £1.95bn. Despite incurring significant debt, the company’s performance for the 2022 financial year met expectations. Revenue grew by 74% to £1.24bn, and adjusted EBITDA increased by 82% to £217.9m. However, when factoring in the revenue impact of the William Hill acquisition, organic revenue experienced a 3% decline compared to the previous year.

As 888 moves forward, the completion of the Latvian business sale marks another milestone in its integration program, allowing the company to reallocate resources and focus on core markets and growth opportunities.