A strategic review by Kindred could mean another US sports betting brand is up for sale in Unibet.
Kindred, listed in Stockholm, announced the strategic review Wednesday, the same day as its first-quarter trading update. North American operations improved for Unibet year-over-year, though the brand is still operating at a loss.
While the release about the strategic review does not mention Unibet specifically, it is clear nothing is off the table:
“As part of this strategic process, the Board of Directors will consider all potential alternatives that can deliver value for the Company’s shareholders. Such alternatives could include a merger or sale of the Company (in whole or in part) or other possible strategic transactions.”
Unibet recently changed US tack
Unibet is not the biggest name in US sports betting but it has been in mature markets like New Jersey and Pennsylvania for years.
Those states feature what Unibet is looking for now: legal iGaming. Kindred announced in October that it was pulling out of Iowa, which it had only been in for about a year.
The main reason for leaving the market was the lack of iGaming to help boost profits and cross-selling, CEO Henrik Tjärnström explained on a prior earnings call.
There are still plenty of states that could legalize iGaming, given there are only six states with it now. Whether Kindred is interested in waiting for those states to legalize or not could play into decisions during the review.
New platform launching in NJ
Another positive for potential buyers is that Kindred is launching its own proprietary platform in New Jersey next month.
Operating its own technology will give Kindred better control of the platform and improve the experience for customers, the company noted in its first-quarter earnings presentation.
Kindred cut costs associated with the Unibet brand over the quarter, as it scaled marketing back until the new platform would be live. That helped EBITDA losses drop to $6.8 million from $10.6 million in the first quarter of 2022. Quarterly revenue also improved to $10 million, up 18% from last year.
Unibet the latest name tied to M&A
Growth has been the major focus in the first few years of legal US sports betting. Now, as operators grow more concerned with turning a profit and having a sustainable business, the expected wave of M&A is finally hitting.
Apollo-owned Yahoo seemingly came out of nowhere to buy Wagr, a smaller operator only licensed in Tennessee that focuses on peer-to-peer betting.
PointsBet‘s US business is also available to the right bidder, reportedly after a failure to sell its Australian assets.