Entain Sells 20% Stake in CEE Business, Moves Towards Full Exit

Entain has reached an agreement to sell a 20% stake in its Central and Eastern European (CEE) business, a move that signals the beginning of its planned complete exit. The announcement came on Thursday, revealing that Entain is selling this 20% interest in Entain CEE to EMMA Capital, its joint venture partner. The deal includes an upfront payment of €395 million ($448.6 million), along with a subsequent payment in early 2027 based on Entain CEE's performance for the fiscal year 2026. This brings the total cash consideration to about €425 million, reflecting an enterprise value of €2.1 billion for Entain CEE. The funds from this transaction will be used to decrease Entain's existing debt. Expected to finalize in the fourth quarter of 2026, the sale hinges on obtaining regulatory approvals. Once the deal is completed, Entain's ownership will decrease from 67.5% to 47.5%, and EMMA Capital's share will rise from 22.5% to 47.5%. The remaining 10% will remain with the Juroszek family. Beyond this initial divestment, Entain intends to fully exit its CEE operations, which includes its STS business 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 maximizing value for shareholders," stated Entain CEO Stella David. She added, "This enables us to unlock the value created by our Croatian and Polish businesses and demonstrates our capital allocation discipline." The rationale for Entain’s exit from the CEE business is based on three main factors. Firstly, it aligns with the company’s strategy to enhance shareholder value while simplifying its organizational structure. Additionally, Entain believes this move will realize the value accrued since the establishment of the CEE business in 2022, in partnership with EMMA Capital, following its €690 million acquisition of a 75% stake in SuperSport. In the subsequent year, Entain also acquired STS for £750 million, with both entities maintaining their market-leading positions in their respective areas. Finally, Entain cited its balance sheet and financial flexibility as a key reason for the exit. Future proceeds are intended to reduce the group’s reported leverage below 3x 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 remarked. "Entain remains well positioned to be a long-term industry winner." In light of this divestment, Entain has revised its guidance for fiscal year 2026. While it continues to expect online net gaming revenue (NGR) growth of 5%-7% in constant currency, the online EBITDA margin is now anticipated to be between 21% and 22%, a reduction from the previously estimated range of 23%-24%. The company remains aligned with the consensus estimate of £1.13 billion in underlying group EBITDA based on insights from 11 analysts. Furthermore, Entain expects to generate approximately £500 million in annual adjusted cash flow in 2028, with additional guidance slated for release during its interim results on 13 August.