The French gaming operator, La Française des Jeux (FDJ), showed exceptional growth in 2023, with a record 6.5% year-on-year revenue rise. The gaming titan is already a leader in the French gambling industry and is eager to dominate the European market. This year, FDJ made an offer to acquire the Kindred Group. If completed, the acquisition would make FDJ Europe’s second-largest gaming operator after successfully closing a series of deals in recent years. These calculated moves highlight FDJ’s dedication to expansion, diversification, and innovation in the fast-paced gaming sector.
The Sustained Growth Curve
La Française des Jeux (FDJ), one of the world’s leading gambling companies, has overcome significant challenges in the past. The company’s growth and performance have recently surged, shaking up the global gambling scene. In the last year, the formerly state-owned monopoly reported a remarkable revenue of €2.621 billion. Its net profit soared from €307.9 million in 2022 to an impressive €425 million, marking a 38% increase.
This exceptional performance is attributed to strong momentum in the competitive sports betting and iGaming sectors, which grew by 2.8%. These segments showed positive results and a robust market presence towards the end of the year. The lottery segment, however, was the major revenue driver, benefiting from solid fundamentals and achieving a 7.8% increase in revenue
Targeting Kindred
In its recent expansion frenzy, FDJ intends to buy Kindred Group. The company Kindred is in charge of well-known players like Unibet and Bingo 32Red. The FDJ offer is set for 2024 and is valued at 27.95 Swedish kronor (US $2.67 billion). The sum equals 130 kronor ($12.4) for each remaining share. The takeover bid is among the best in the industry’s history. It represents a 24% premium over Kindred’s previous share price.
FDJ and the Kindred Group have confirmed their investment plan, aiming to develop the best French online casinos and establish a gaming champion on the continent. FDJ, with its global reputation, offers various gambling platforms, including horse-race betting, lotteries, and poker games. Kindred CEO Nils Andén responded to the offer, saying, “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 expand its global footprint further.”
The Kindred offer represents a strategic endeavor to broaden the consumer base. It will assist in successfully targeting the more than 30 million locked clients distributed across North America, Europe, and Australia. The acquisition would also greatly benefit FDJ’s foreign expansion efforts. Current forecasts indicate that if the Kindred acquisition plan is successful, FDJ’s revenue might climb to around 20% from 6%. Better yet, the FDJ stands to strengthen its digital command. The deal could potentially increase its internet business gains to almost 20%, up from 14% currently.
B2C Expansion Plan
The proposed acquisition of Kindred will be added to the several previous transactions completed by FDJ in recent years. Over the last year, the organization has pursued an ambitious strategy. In 2023, FDJ made a significant step towards achieving its objectives by acquiring Premier Lotteries Ireland and ZEturf. Towards the end of the year, the company completed the acquisition of Premier Lotteries. This transaction marked the beginning of the company’s foray into managing overseas lotteries.
FDJ’s current strategy is to increase earnings and accelerate growth, which includes purchasing another top-ranking organization. Stephane Phalllez, the chair and CEO, believes the firm has accomplished much in recent years and is on track for much more growth. The company’s medium-term goal is to grow its revenue organically, which appears possible given its present performance in iGaming and online sports betting.
Recap
The French gaming operator La Française des Jeux is set to acquire online gambling firm Kindred with an audacious bid worth $2.7 billion. In 2024, the company plans to expand with its tried and tested B2C strategy. The FDJ’s increasing trajectory represents a corporation ready and prepared to dominate the European gambling sector while striving to be a global gaming giant. The company’s performance in 2023 demonstrates that it has the muscle to perform even better. Other organizations worldwide may benchmark and learn much from this proven gambling industry leader in various areas, including strategic expansion and adopting appropriate values.
