The proposed combination would produce the world’s second-largest listed gaming operator, with pro forma adjusted EBITDA of around €2 billion
The transaction would give the combined business leading positions in Italy and Spain while increasing its exposure to online gaming and other growth markets.
Lottomatica Group and CIRSA Enterprises have signed a binding merger agreement covering an all-share combination. The transaction will take the form of a cross-border merger in which Lottomatica absorbs CIRSA.
CIRSA will cease to exist as a separate legal entity once the deal becomes effective, without entering liquidation. Lottomatica will remain as the surviving company and issue new shares to CIRSA investors.
The merger is expected to become effective during the second quarter of 2027, subject to shareholder and regulatory approvals.
CIRSA shareholders to receive Lottomatica shares
CIRSA shareholders will receive 0.668 newly issued Lottomatica shares for every CIRSA share they hold.
Existing Lottomatica investors are expected to own 67.5% of the combined company, with CIRSA shareholders holding the remaining 32.5%. Blackstone, CIRSA’s controlling shareholder, is expected to retain approximately 24% of the enlarged group.
Published estimates place the implied all-share value of CIRSA at approximately €2.8 billion.
The combined company will retain listings on Euronext Milan and the Spanish stock exchanges, subject to the necessary admission procedures.
Group targets €2 billion in adjusted EBITDA
Lottomatica and CIRSA said the transaction would create the world’s second-largest listed gaming and sports betting operator.
The companies forecast pro forma adjusted EBITDA of approximately €2 billion and a combined addressable market of €34 billion. The enlarged business would hold nine leading market positions, including number-one positions in Italy and Spain.
The merger is also expected to reduce Lottomatica’s dependence on the Italian market by adding CIRSA’s land-based and online operations in Spain and several Latin American countries.
Lottomatica plans to use its online and omnichannel capabilities to support the organic and acquisition-led growth of CIRSA’s digital operations.
Annual cash synergies estimated at €115 million
The companies expect the combination to generate approximately €115 million in annual pre-tax cash synergies.
These savings would come from lower operating expenses and interest costs. The full amount is expected to be achieved by the third complete financial year following completion.
The estimate remains a forward-looking target and will depend on the integration of the two businesses, financing conditions and the delivery of planned cost reductions.
Guglielmo Angelozzi, Chairman and CEO of Lottomatica
“By combining Lottomatica and CIRSA, two highly successful companies, we are creating the clear leader in Italy and Spain, which are among the world’s best gaming markets, complemented by leading positions in other high-growth territories.
“The combination offers more routes for expansion, particularly online, with a similar level of capital returns but greater resilience and low execution risk. We look forward to working with Antonio and his team to continue delivering growth and superior long-term returns for our shareholders.”
Dividends and financing form part of transaction
CIRSA intends to distribute an extraordinary dividend of €262 million immediately before the merger becomes effective.
Lottomatica also plans a capital distribution of €744 million after completion. Both payments will be funded through a combination of existing cash and committed debt financing.
The companies expect pro forma net debt to adjusted EBITDA to stand at 2.7 times on 30 June 2027.
Lottomatica’s board may propose up to €4 billion in capital distributions during the first three years after completion. Any dividends or share repurchases would remain subject to the board’s decisions and annual shareholder approval.
These amounts should therefore be treated as proposed capital-allocation capacity rather than guaranteed payments.
Angelozzi to lead 13-member board
The combined company’s board will have 13 members: Lottomatica’s 11 current directors and two additional directors nominated at Blackstone’s proposal.
Guglielmo Angelozzi will serve as Chairman and CEO. Laurence Van Lancker will be Chief Financial Officer and Deputy CEO.
Antonio Hostench will continue as CEO of CIRSA’s operations, while Antonio Grau will remain its Chief Financial Officer.
Antonio Hostench, CEO of CIRSA
“I am extremely pleased to begin this exciting journey together. The combination of CIRSA and Lottomatica creates a diversified, world-class gaming leader with strong positions in its key markets and important opportunities to accelerate profitable growth.
“The CIRSA team is fully committed to the success of this transaction and looks forward to working with our Lottomatica colleagues to realise its full potential and build an even stronger business.”
Completion requires several approvals
The companies must prepare and approve a joint cross-border merger plan before completing the transaction.
The deal also requires approval from the general meetings of both companies. Further conditions include foreign direct investment, competition, gaming and EU Foreign Subsidies Regulation clearances.
Until those requirements are satisfied and the merger becomes effective, Lottomatica and CIRSA will remain separate companies.
