Lottomatica & Blackstone agree on terms to absorb CIRSA

Lottomatica Group has informed the Borsa Milan that it intends to merge with Cirsa Enterprises through an all-share transaction. A prospectus issued to Milan investors this morning detailed Lottomatica’s plans to lead the combination of the businesses and establish outright market leadership in Italy and Spain. The deal will create an enhanced platform to accelerate growth in South American markets. Deal terms will see Cirsa absorbed by Lottomatica but retain its brand and assets in core markets. The combined business will continue under the Lottomatica name as the legal entity. The prospectus details that Cirsa shareholders will receive 0.668 newly issued Lottomatica shares for every Cirsa share held, giving them approximately 32.5% of the enlarged company. Existing Lottomatica investors will retain the remaining 67.5%. Though undetermined, Italian analysts believe that Lottomatica has placed a corporate valuation on CIRSA in the range of €2.8bn-to-€3bn (£2.3bn-£2.5bn). The merger is expected to create “global gambling’s second-largest listed betting and gaming operator”, generating combined income of more than €4.4bn and pro-forma adjusted EBITDA of approximately €2bn for the 12 months ending 30 June 2026. Lottomatica stated: “The proposed combination will create a global leading sports betting and gaming player, with number one positions in Italy and Spain.” Blackstone remains CIRSA’s anchor US Private Equity fund Blackstone Cirsa’s majority shareholder, has committed its support to the transaction as it retains circa a 75% shareholding in the Spanish gambling group. Blackstone began its investment in CIRSA back in 2018, building-up its majority stake in subsequent transactions from the Lao Hernández family. The PE fund led CIRSA public listing on the Madrid Bolsa in July 2025, beginning its divestment of shareholding. Since the Madrid IPO, speculation has mounted on Blackstone’s options with regards to its interest in CIRSA and the wider Spanish gambling market. Following completion, Blackstone is expected to become the largest individual shareholder in Lottomatica, controlling approximately 24% of the enlarged company. Ahead of the merger, Cirsa will distribute an extraordinary dividend of approximately €262m, equivalent to €1.56 per share, to its existing shareholders. Lottomatica’s board also intends to ask shareholders of the combined company to approve an additional €744m capital distribution after completion. This may be executed through an extraordinary dividend, a partial share buyback or a combination of both. The partners expect the integration to generate approximately €115m in annual pre-tax cash synergies by the third full year following completion. Management also forecasts capacity for up to €4bn in dividends and share buybacks during the first three years after the transaction. The proposed combination will bring together Lottomatica’s dominant Italian retail and online businesses with Cirsa’s Spanish casino, gaming hall, slot machine and online operations. Cirsa will also provide the enlarged group with an established foundation in Latin America, including operations in Colombia, Panama, Peru and Mexico. Angelozzi executes Lottomatica expansion Lottomatica Chairman and Chief Executive, Guglielmo Angelozzi, will retain both positions following the merger. The new board will comprise 13 directors: Lottomatica’s existing 11 members and two additional directors nominated by Blackstone. The combined group will maintain its principal headquarters in Rome, alongside a secondary headquarters for Cirsa’s operations in the province of Barcelona. Lottomatica shares will continue to trade on Euronext Milan, while the enlarged company will pursue an additional listing across the Spanish stock exchanges. The arrangement effectively replaces Cirsa’s independent market listing, just over a year after the Spanish group completed its IPO. The transaction is expected to become effective during Q2 2027, subject to approval by both companies’ shareholder meetings and the receipt of all required regulatory and competition clearances. Recognised as Italy’s largest gambling operator, Lottomatica portfolio spans online gaming, retail betting and gaming machines. Its portfolio includes the flagship Lottomatica brand alongside major betting and gaming businesses GoldBet and Planetwin365. Should the transaction proceed, Angelozzi will fulfil one of the corporate objective cited to Lottomatica investors, to expand the business beyond Italy in which the CEO previously stated that single market focus had undermined the company’s value. At the start of 2026, the CEO warned markets that Lottomatica was planning a major move to significantly enhance its status amongst global gambling PLC ranks. This morning Guglielmo showed his hand with this bold and transformative merger.