Entain PLC (LSE:ENT) said it agreed to buy Dutch betting company BetCity from Sports Entertainment Media BV for an initial €300 million cash.
Payment will include a deferred conditional amount capped at a maximum of €550mln, the Ladbrokes owner said in a statement.
A performance-based payment will be due in early 2023 and a further contingency amount will be considered in early 2024 based on the company’s underlying earnings for the prior fiscal year.
A final payment of €50mln will be dependent on the successful migration of BetCity to the Entain platform.
BetCity was granted a licence from Dutch gaming and gambling authority KSA in October 2021 and had a 20% share of the market in the fourth quarter of 2021.
Entain said BetCity will complement its bwin and Party brands which are awaiting approval for a licence to operate in the Netherlands - now expected in the latter part of this year.
The acquisition will deliver €28mln of cost synergies between the companies' technologies, content and royalties by the end of 2026.
Entain said it will fund the deal by existing cash and drawing on the group’s revolving credit facility.
The purchase is expected to close in the second half of the year.
"This transaction further underpins our growth strategy of operating in attractive regulated markets," Jette Nygaard-Andersen, chief executive of Entain, said.