Rank Group calls time on Belgian operations in £25m Kindred Group sale

Rank Group has sold its sole-remaining Belgian casino property and associated online gambling licence to Kindred Group in a £25m all-cash deal.

The agreement includes 100% interest in the Blankenberge casino property, which is operated by Blancas NV, a business owned by Rank Group since 1998.

The acquisition is on a cash free and debt-free basis and will be settled entirely in cash upon completion, which is expected to take place in Q4 2020.

However, regulatory approval from the Belgian Gaming Commission (BGC) and the Blankenberge City Council are required before the acquisition can complete.

Blancas NV has an existing long-term commercial partnership with Kindred dating back to August 2012.

The Stockholm-listed operator offers online casino, live casino and poker to Belgian customers via its flagship Unibet brand through Blancas NV’s “A+” licence as part of the commercial arrangement.

Under Belgian gambling laws, “A+” licences can only be awarded to Belgian operators with a land-based presence.

The BGC renewed the Blankenberge casino licence in 2018, with a new 15-year concession set to begin in January 2021.

“The acquisition demonstrates Kindred’s long-term commitment towards the Belgian market and gives Kindred direct access to one of the nine casino licences, which allows Kindred to continue to offer a broad offering to its Belgian customers,” Kindred Group said.

Blancas NV will eventually operate as a separate entity within Kindred Group under the leadership of the current management team led by Dominique De Wilde.

Blancas NV generated revenue of approximately €10m (£9m) in the last 12 months to the end of June as operating profits reached €3m.

The Blankenberge casino contributed £2.7m to Rank Group profits before tax, with gross assets totalling £4.2m in the same period.

Rank Group said net proceeds from the sale will be used to reduce its net debts and for general corporate purposes.

“The group continues to review opportunities for maintaining appropriate levels of debt for the business,” said Rank. “The disposal will also support management’s focus on Rank’s transformation 2.0 programme to drive improvement across its core businesses.”

Rank Group closed its other Belgian casino in Middlekerke in September 2017. The UK-centric casino business also operates nine gaming halls in the Spanish market, but its 144 UK venues have been severely hit by restrictions imposed due to the coronavirus pandemic.

“Today’s announcement of the sale of the Blankenberge casino secures the next chapter for a great venue in Belgium and a team that deliver an excellent customer experience to the local community,” said Rank Group CEO John O’Reilly.

“As a standalone casino, the business was non-core to Rank’s international growth plans and the £25m sale proceeds supports the group’s liquidity and future growth initiatives,” he added.

Rank Group is expected to provide an update on trading, liquidity and covenants at an AGM scheduled for 11 November.