DAVY VIEW

Entain released further information on its acquisition of 365scores and its strategic partnership with Tab New Zealand (Tab NZ) including presentations from management. Combined, the group expects an EBITDA contribution of £15-20m (c.2%) in FY24 and £50m in FY25 (c.2% and 4% respectively) to group. Including its projections for good growth in 365scores, it estimates that the acquisition multiple for the two will be 5x FY25 EBITDA. This follows last week’s announcement that Entain had entered into a deferred prosecution agreement with the Crown Prosecution Service regarding its former business in Turkey, noting that there will likely be a “substantial financial penalty” which we understand could be in excess of £200m. The company had previously revealed on two occasions that there were ongoing investigations, so the issue appears to be hopefully reaching a conclusion, resolving a known risk. However, there remains uncertainty around the quantum of the penalty which may weigh somewhat on sentiment until finalised.