Entain plc wants to pull out from non-regulated markets

The international operating gambling company Entain plc has recently announced that it will accelerate its plans to pull out from non-regulated markets. The company aims to generate all its income from nationally regulated markets by the end of 2023. Thus, Entain plc wants to pull out from all non-regulated markets in a timely manner. But what is the reason for this big decision?

Entain plc is an enormously successful gambling company, which has more than 25,000 employees worldwide. Recently in 2021 the company generated a total turnover of more than 3.8 billion Euro. In October 2021 we had reported that Entain plc had increased its online turnover for the 23^rd. consecutive time. In Autumn 2020 Entain plc announced that by the end of the business year 2023, the company will generate its turnover from markets regulated by the state and therefore from legal markets.

Entain plc will bow out from non-regulated markets

The Gambling Authority, which is registered on the Stock Exchange, plans to bow out from all non-regulated markets. There will be an exception for the markets which are currently not regulated but which are envisaging that a relevant legislation will take place soon. Just recently Entain plc was the first company to receive the first licence for online poker as well as other licences for virtual slot games.

Entain plc’s intention to bow out from the non-regulated markets will most likely have minimal effects on the net gaming as well as on the EBITA of the company. Entain plc is currently already generating the largest part of its turnover from regulated markets. Entain plc had originally planned to distance itself from all unregulated markets by the end of the business year 2023. Entain plc has announced that it wants to speed up this process and start bowing out from the grey markets as from this month.

Barry Gibson, CEO of Entain plc, stated the following:

“As part of the transformation programme which Entain plc has gone through in the past years, we have decided that in 2023 we will operate only in nationally regulated markets.”

What is the reason why the company is pulling out of unregulated markets?

Entain plc wants to “operate in a sustainable and responsible way” and at the same time grow in the industry. For this reason, it was decided that in the future the company will stay away from non-regulated markets. Financial concerns were the main determining factor in this decision. For example, more players in Germany were requesting a disbursement of their casino losses from the online casinos. Just recently we had reported that the LG Ulm had awarded a player a refund of 170,000 Euro.

For games of chance companies like Entain plc their presence on unregulated markets is becoming an ever-increasing financial risk. Further to this, the turnover which Entain plc makes on the unregulated markets does not carry such a large weight in the company. The withdrawal of Entain plc is a logical consequence of the current situation on the online gambling market. In Juni 2021 we had reported that the Gambling giant Entain plc supports a child welfare organisation.

The commitment of Entain plc towards regulated markets was very well received by shareholders on the stock exchange. The day before the announcement was made the share price of Entain plc stood at 15.90 Euro (17th.January 2023). The current price is already 16.90 Euro (29th. January 2023).

Entain plc will remain active on the German online gambling market

According to its own statement Entain plc is currently licensed in over 30 countries. Since a few weeks it has been also licensed on the German online gambling market. Thus, gambling enthusiasts should not fear that Entain plc will retreat from the German market. According to the official whitelist of the GGL, the Gambling Authority for all regions in Germany, the company holds the licence for online slots for the brands bwin, Ladbrokes and Sportingbet. Besides this, Entain plc holds the licence for online poker for the brands bwin and Ladbrokes.

Conclusion

The gambling giant Entain plc will retreat from the non-regulated market earlier than planned. By latest the end of this year Entain plc wants to be generating its turnover solely from regulated markets. This decision went down well with the investors on the London Exchange. Most likely it will also significantly improve the image of Entain plc.

Image source: https://pixabay.com/de/photos/rechner-zusammenfassung-diagramm-767776/