Entain announced its decision to divest a 20% stake in its Central and Eastern European (CEE) business, a significant move toward a complete exit from the sector. On Thursday, the company revealed it has agreed to sell this interest in Entain CEE to EMMA Capital, its partner in joint ventures.
The transaction entails an immediate payment of €395 million ($448.6 million) upon closure, with an additional payment slated for early 2027 based on Entain CEE's performance for the fiscal year 2026. Altogether, the cash consideration is expected to reach approximately €425 million, highlighting an enterprise value of €2.1 billion for Entain CEE. The proceeds from this sale are intended to help reduce Entain's existing debt.
Completion of the stake sale is projected for the fourth quarter of 2026, pending the necessary regulatory approvals. After the deal's finalization, Entain's ownership will decrease from 67.5% to 47.5%, while EMMA Capital's share will rise from 22.5% to 47.5%. The remaining 10% will continue to be held by the Juroszek family.
In addition to the initial divestment, Entain has also expressed plans to completely exit the CEE business, which includes STS operations in Poland and SuperSport in Croatia. "Our initial divestment is a decisive first step towards Entain fully exiting Entain CEE and reflects our ongoing focus on maximising value for shareholders," said Entain CEO Stella David. "This enables us to unlock the value created by our Croatian and Polish businesses and demonstrates our capital allocation discipline."
Entain CEE reported £522 million in net gaming revenue (NGR) for the fiscal year 2025, a 7% increase from the previous year, along with a 7% rise in EBITDA to £184 million. However, in the first quarter of 2026, the NGR from CEE operations fell by 6% compared to the same period in 2025.
The rationale behind Entain's exit from the CEE market is rooted in several strategic factors. Firstly, this move aligns with the group's objective of maximizing shareholder value while simplifying its overall structure. Secondly, the exit is expected to capitalize on the value generated since the establishment of Entain CEE in 2022 in partnership with EMMA Capital, following Entain's €690 million acquisition of a 75% stake in SuperSport. When this acquisition occurred, Entain indicated that it would lead to further acquisitions in the CEE region, and the subsequent year, it acquired STS for £750 million. Both STS and SuperSport have retained their status as market leaders since their acquisitions by Entain CEE.
The third reason for the exit involves improving the balance sheet and enhancing financial flexibility, as proceeds from the sale would help reduce the group's reported leverage below three times and return excess capital to shareholders. "Driven by structural growth across our globally scaled portfolio and our improving operational execution, I am confident in our ability to deliver strong future cash generation," David added. "Entain remains well positioned to be a long-term industry winner."
Entain also provided an update on its fiscal year 2026 guidance in light of the 20% divestment. While it maintained its expectation for 5%-7% online NGR growth in constant currency, the online EBITDA margin is now projected to fall between 21% and 22%, a reduction from the previous range of 23%-24%. The company is still on course to reach an underlying EBITDA consensus of £1.13 billion, based on estimates from 11 analysts. Additionally, Entain anticipates generating approximately £500 million in annual adjusted cash flow by 2028, with more detailed guidance expected during its interim results presentation on August 13.
