$2.7B Kindred Group Takeover by French Lottery Giant FDJ Approved — With Caveat
French competition authorities have given the green light to the $2.7 billion deal for the acquisition of Stockholm-based online gambling leader the Kindred Group by Française des Jeux (FDJ), France's lottery monopoly.
Toutefois, le régulateur l’Autorité de la Concurrence a souligné qu'il devait y avoir une nette distinction entre les activités commerciales de la FDJ et son entreprise monopolistique. This indicates that FDJ, an ex-state-owned entity, will not be allowed to market Kindred’s offerings to its lottery and sports betting clientele.
Additionally, l’Autorité de la Concurrence stated that it must not "have a shared root or logo with the FDJ or Parions Sport Point de Vente brands, or any other brand associated with FDJ's monopoly games marketed in France." Participants must register individually for accounts with the FDJ and Kindred brands.
The regulator determined that not doing so would provide FDJ with an undue edge over competing commercial operators.
Monopoly Currency
Kindred, previously known as Unibet Group, possesses several of Europe’s most recognized online casino and sports betting brands, such as Unibet and 32Red.
FDJ, France's biggest gaming operator, underwent privatization in 2018 when the French government divested 50% of its stake. In November 2023, the firm purchased Ireland's national lottery operator, Premier Lotteries Ireland, establishing it as the second-largest lottery operator in Europe and the fourth-largest worldwide.
In October of last year, FDJ finalized its purchase of the online horse racing betting platform ZEturf, the sole sector of the gambling market it had yet to enter. ZEturf is likewise affected by its detachment from the company's dominant brands.
Ironically, ZEturf's primary rival is the retail horse race betting monopoly of France, Pari-Mutuel Urbain (PMU). In 2020, l’Autorité de la Concurrence imposed a €900K fine on PMU for not segregating its online and land-based customers.
This came after a complaint from ZEturf claiming that PMU's co-mingling of the two channels gave it an unfair edge over other operators providing horse racing pools.
‘Champion of Gaming’
After the announcement of the Kindred acquisition attempt in January, FDJ Chair Stéphane Pallez stated that the agreement would establish a “European gaming champion.”
In a rather critical remark, Regulus Partners indicated that Kindred’s genuine appeal was that “it allows excess cash flow generated from a privatized state monopoly to be pumped into a ready-made competitive platform which the sclerotic, statist FDJ failed organically to create.”