The Israeli tech billionaire Teddy Sagi was set to add nearly £300m to his vast fortune yesterday, as the Playtech software business he founded announced plans to spend up to €458m (£333m) on another Sagi company, the options broker TradeFX.
Playtech – in which Mr Sagi holds a 33.6 per cent stake – will in effect pay him up to £287m under the deal as Mr Sagi’s Telesphere trust owns 86.5 per cent of TradeFX. The rest is held by TradeFX’s management.
The deal allows Playtech – the world’s largest supplier of online gaming and sports betting software – to push into the lucrative market of contracts for difference trading. CFDs allow investors to trade shares without buying them, using leverage to increase returns while avoiding stamp duty.
Consolidation activity in the gambling industry has gathered steam because increases in taxes and regulations in some of the biggest markets are hurting companies.
The acquisition replenishes Sagi’s coffers after he spent £500m buying up London’s Camden Market last year, before floating Market Tech Holdings in December.
TradeFX is currently regulated in Cyprus, although it is understood to be applying for a licence from the Financial Conduct Authority. It made pre-tax profits of $31.8m (£21.3m) last year, employing more than 500 staff, with offices in five countries.
Playtech chief executive Mor Weizer said the technology firm was on the look out for more deals after bookmaker William Hill paid Playtech £424m in 2013 to buy out its stake in the bookmaker’s online business. He said: “Playtech will retain significant resources to continue to pursue further acquisition opportunities.”