Wednesday, March 20, 2019

If there is one thing we humans are not very good at, it’s making decisions. Ask people if they are good decision-makers, and most will tell you that they are. In fact, though, they are not, generally speaking. Stock and commodities traders and investment managers, for instance, are notorious for thinking they are better than they actually are.

It is not enough to know what information we need to make a decision; we should also understand how we make them, if we want to make good ones. One of my heroes, behavioural psychologist Daniel Kahneman, believes we have two internal systems that work to help us make these judgment calls. There is the ponderous logical system that analyses the data and comes to a rational conclusion – what he calls the slow system – and the intuitive gut system that relies on an emotional response, the fast system. Each has their place.

CDC Gaming Reports

It’s been a busy start to 2019 for the London Stock Exchange-listed 888 Holdings. The operator hit the headlines recently with two major acquisitions – one more controversial than the other – as well as some thought-provoking financial results.

On the surface of things, the flurry of acquisition activity looks positive. 888 agreed to an £18m deal to acquire JPJ’s Mandalay business in February, a deal which was completed last week.

The acquisition adds a raft of brands to 888’s UK bingo offering, and integration should be straightforward, since the operator has been supplying its Dragonfish bingo platform to Mandalay since 2009. However, analysts are understood to regard the move less as a strategic bolstering of the firm’s bingo offering and more as a defensive attempt to rescue an under-performing asset in which 888 has a vested interest.

The Euro News Revue
by Hannah Gannagé-Stewart and Andrew Tottenham
Intralot SPA has denied rumours that it will merge with Athens-listed IT solutions provider Intracom Holdings this week. As SBC points out, the speculation follows the loss of the Greek gambling technology group’s Turkish IDDAA sports betting concession to Sans Girisim, a joint venture between Nasdaq-listed Scientific Games and Turkish media conglomerate Demirören Holdings. Intracom founder and majority shareholder Sokratis Kokkalis appears to be the source of the refuted rumours. Greek news sites reported he was mooting a merger of Intracom assets; Intrakat (construction), Intralot (lottery/gambling) and Intrasoft (logistics technologies). However, by the close of trading on March 15, both Intralot and Intracom had released somewhat non-committal independent statements saying the ‘news reports did not correspond with reality’. No smoke without fire? (HGS)
Swedish regulator Spelinspektionen has taken steps to shore up its stance on “excessive”advertising this week. iGaming Business reports that the regulator has formalised a cooperation deal with the country’s consumer agency, Konsumentverket, which will now oversee moderate marketing and direct advertising to self-excluded customers. Since re-regulating at the start of the year, Sweden has offered little clarity over what constitutes an acceptable level of advertising under the new regime, but operators are now being advised to seek guidance from the consumer agency. Spelinspektionen has said a clear definition will emerge as the market matures; in the meantime, however, operators need to tread carefully, as the regulator has also warned that retrospective sanctions could be imposed once regulations are established. (HGS)
Who would have thought little Andorra could provoke such a storm? You may remember that the Principality, situated between France and Spain high in the Pyrenees, held a public tender last year to issue a license. Several companies responded to the tender, including Groupe Lucien Barriere and Groupe Partouche, both from France, and Genting UK. The latter bid with a scheme that would have cost in excess of €100 million. The competition was won by local company JOCS SA, who bid with a project of about €14 million and technical support provided by Novomatic, after the adjudicator ruled Genting UK’s bid non-compliant. Then the accusations started to fly. At first, those developers that didn’t win accused the adjudicators of bias and asked that the tender be declared null and void. Now there are two different tacks. Groupe Lucien Barriere, whose bid came second, has said that the winning bid should be annulled and their bid should win. Groupe Partouche and Genting UK have brought criminal proceedings against the advisor to the Government, accusing him of “influence peddling.” I do not see how this can end well. (AT)
The northern German state Schleswig-Holstein is seeking an extension to recently expired casino licences in the region, while lawmakers continue to thrash out the country’s State Treaty on Gambling. Schleswig-Holstein has a liberalised regulatory regime; however, the regulations run parallel to the State Treaty, under which iGaming licences were issued to operators in 2012. Those licences began to expire in December 2018. A bill put forward by the state last week would enable those that hold an expired licence to continue offering iGaming until the licences can be renewed. The licences would run until June 30, 2021, by which point the treaty should be finalised, allowing the state to forge forward with an overhaul of its regulatory framework. The treaty is due to be debated by Germany’s 16 minister-presidents on March 21. It will be the third attempt, after failures to reach a consensus in 2012 and 2017, at getting the Treaty passed into law. (HGS)
The shareholders of Sazka have decided to shuffle the assets of the company around. Sazka owns, among other things, the Czech Lottery, a controlling interest in the Greek gambling company OPAP, a minority interest in Casinos Austria, and 67 percent of SuperSport, a Croation sportsbook and online casino company. Using Sazka as their vehicle, shareholders Karel Komarek, who owns 75 percent though KKCG, and Jiří Šmejc, who owns the balance though Emma Capital, have built a company that is one of the larger gambling companies in Europe. After the shuffle, Mr Komarek will own 100 percent of Sazka, minus SuperSport and rather a lot of cash, which Mr Šmejc will own. It’s not clear why the two entrepreneurs have decided to go their separate ways. (AT)
London Stock Exchange-listed 888 Holdings has completed a deal, first announced last month, to acquire a suite of JPJ Group bingo brands, including Costa Bingo, City Bingo and Sing Bingo. SBC reports that the £18m deal was finalised via a cash consideration of £12m paid upon completion, with a further £6m scheduled to be transferred to JPJ Group in September. The raft of bingo assets belonged to JPJ subsidiaries Jet Management Group and Jet Media, which represent the bulk of the company’s Mandalay operating unit. It’s the second major acquisition of the year for 888, which also announced a £15m acquisition of Irish sports betting operator BetBright and its proprietary platform earlier this month. (HGS)
In the latest in a succession of licence removals this year, the Malta Gaming Authority (MGA) has cancelled the licenses of Triton Gaming and Neptune Entertainment. Casino Beats reports that both operators have been told to cease operations with immediate effect, including shutting down their websites. Alongside the pair of revocations, the regulator has also issued a clarification that it has no connection with a website called, saying that references to the MGA on the site are “false and misleading.” The Maltese regulator, which recently signed a memorandum of understanding with its Swedish counterpart Spelinspektionen, appears to be cracking down on errant operators in recent months, cancelling the licences of Bet Service Group and last month and issuing suspensions to Betixx and BTM Entertainment. (HGS)
Italy is a wonderful country: great people, great food and wine, and fantastic history. But it’s a minefield if you are trying to do business there. Last year a court in Como declared that Casino di Campione was bankrupt and the Canton of Ticino, which houses the Italian enclave, went into panic mode. The casino was the main, if not the only, tax payer in Ticino, and its closure has created a large black hole in the region’s accounts. The casino closed, employees were laid off, and a commissioner was appointed to determine what should happen next. Now the Appeals Court in Milan has determined that the Como Court erred in its decision and should not have declared the casino bankrupt. This means the casino can reopen, yes? Not so fast! The case now goes back to the Como Court and the case will be reheard, but with the casino now able to offer representation. If the Court determines that the casino is not bankrupt, the employees whose jobs were terminated do not have a right to go back to work, and the actions of the administrators still have legal effect - even if the casino is not bankrupt. Quite how this is going to work in the long run, I am not sure. The company owes millions and does not make a surplus. Who will want to do business with this casino, or any casino, if it can go into bankruptcy at the drop of a hat? (AT)
This report is edited by Andrew Tottenham and Justin Martin
Tottenham & Co
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