Playtech calls off Plus500 deal over FCA ‘concerns’

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Shares in online gaming group Playtech and its takeover target Plus500 have crashed after the companies called off the £460 million deal because of “concerns” raised by the Financial Conduct Authority. 

Playtech, founded by Israeli billionaire Teddy Sagi who owns much of Camden Market, saw its shares drop 12%, or 102p, to 749.5p while Plus500 fell as much as 21% before settling 5%, or 18.5p, lower  at 340p. 

Neither company spelled out the FCA’s concerns although it is understood they centred on management experience within the two businesses and the previous issue of anti-money laundering systems at Plus500.

The regulator has also made it clear in recent months that it is focusing its firepower on offshore-registered gaming and financial trading companies.

Playtech is based in the Isle of Man and Plus500 in Tel Aviv.

Playtech said: “The company has discussed with Plus500 the consequences of the recent developments with the FCA and has agreed to the termination of the merger agreement.”

It also said that the smaller bolt-on $105 million acquisition of Dublin-based financial trading firm AvaTrade, which had been objected to by the central Irish bank, was also no longer likely to go ahead. 

Broker Cenkos said the announcement by Playtech had “clearly damaged credibility” and left uncertainties over its cash pile and 9.9% stake in Plus500.

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November 23, 2015 |
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