Flutter Entertainment to buy online bingo operator Tombola for £402m

Flutter Entertainment, the parent company of Paddy Power, Betfair and Sky Bet, is set to add leading online bingo operator Tombola to the group in a £402 million deal.

The acquisition is expected to be completed in the first quarter of next year, subject to approval from the Competition and Markets Authority.

Tombola was founded in Sunderland 15 years ago by Phil Cronin, growing to a company with 400,000 average monthly players and more than 700 employees.

In its latest financial year Tombola generated revenue of £164m and Ebitda (earnings before interest, taxation, depreciation and amortisation) of £38.5m. More than 80 per cent of its revenue comes from the United Kingdom, with another 16 per cent coming from Italy and Spain.

Tombola was the first major UK-focused operator to introduce both mandatory staking and deposit limits, and has an emphasis on low-stake play, making it an attractive proposition given the potential impact of the government's gambling review.

Flutter chief executive Peter Jackson

Flutter chief executive Peter Jackson said the company was delighted to add Tombola to the group.

He added: "Tombola is a business we have long admired for its product expertise, highly recreational customer base and focus on sustainable play.

"The brand aligns closely with Flutter's safer gambling strategy, a key area of focus for us. I am excited to combine Flutter's digital marketing expertise with Tombola's operational capabilities within the UK & Ireland division.

"As the time comes for Phil to hand over the reins, I would like to thank him for building the success story that the business is today, and I look forward to welcoming the Tombola team to Flutter and growing a sustainable business for the future together."

Gavin Kelleher, gaming and leisure analyst for stockbrokers Goodbody, said he thought the deal would be a positive for Flutter.

He added: "While increasing its exposure to UK online may not be something some expected in advance of the Gambling Act review, we would note that Tombola has always been focused on the lower staking, highly recreational end of the market."

Flutter's share price was up 105p to 11,795p on Thursday morning.

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