DigiPlus clarifies: 'No definitive plans' to acquire CasinoPlus

DigiPlus [PLUS 19.94, down 4.4%; 128% avgVol] [link] clarified a report that it was “in talks” to acquire CasinoPlus, an online game operator (the “Color Game”) and provider of “back-end support for the PIGO operations of... land-based operators.” (link) In its brief statement, PLUS said that “acquisitions have always been in the Company’s plan as part of its strategic expansion”, but said that “there are no definitive plans at this time.”  Casino Plus also operates a physical casino location at Hotel Stotsenberg in Clark Freeport Zone. PLUS generated P3.5 billion in net income last quarter and has reported having over P12 billion in “cash and cash equivalents (up over P8 billion in the past 12 months). The company has repeatedly said in its “FUTURE PLANS” that it intends to become the “number one digital entertainment group in the Philippines”.

MB bottom-line:  According to Will Cabangon (link), the Q3 e-game GGR (gross gaming revenue) total was around P36 billion in the Philippines, and the acquisition of CasinoPlus would give PLUS “almost 85% marketshare” of the e-game market. Depending on the price, this is a no-brainer for the PLUS group, and a move that aligns with its business plan and vision. Making an ungodly amount of money in a short period of time is actually a strange test of a company’s management team. I was bracing for some random pivot into real estate or some other vaguely related store of value, but I love that the team is staying in the pocket and leaning into using its cash to build out on its existing edge. Both here (with Casino Plus) and abroad (Brazil). Bilyonaryo was the author of the original article, and they’re usually pretty good when it comes to their sourcing. I don’t think this smoke is “immaculate”, I’m just curious how long it will take to see the fire.   

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