The interesting thing about the thickening plot surrounding one of Britain’s biggest operators, Sceptre Leisure, and the speculation surrounding its supposed coming acquisition by Germany’s Gauselmann Group, is the take on the situation by the retailers.
The hype has been escalating… admittedly, assisted by ourselves, but in the absence of a deal in this long, drawn-out affair, or the formal withdrawal from talks by either side and a statement to clear the air, then the chatter will remain undiminished.
With Teddy Sagi’s name now being drawn into the affair – Sagi is the gaming mogul based in Israel who owns nearly half of Playtech – the talk is further stimulated. Sagi doesn’t do losses. He bought nearly one-third of Sceptre two years ago at around 32p a share, considerably higher than the current value. If a deal is struck to sell the company, he won’t sit back and accept a major loss on the exercise.
But beyond all of that; what about the retailers? As we all know, the value of any operating company is in its sites, or if you like, the contracts it currently has with the retailers. We know that Sceptre operates around 25,000 pieces of equipment, but only a portion – probably a sizeable portion – of those are Category C machines. They will be principally in the hands of retailers. How will they react to a change in ownership? And particularly, how would the react to a German owner? Not because they are German, but perhaps because they might want to impose the German system of operating AWPs on Britain’s Category C business. Thicken the plot further with the fact that the largest operating company, Gamestec, is now owned by Gauselmann’s major rival, Novomatic of Austria, who also have a huge slice of the German operating business with the same business model – the leasing or renting of machines and their content.
If Gauselmann buys Sceptre and if they want to bring in the German system, how would the retailers react to giving up a slice of the action? I suppose the short answer is that they’ll be prepared to do anything which will drive up their income. But first they have to be convinced that the incomes WILL be driven up by the imposition of a new system with its video-based reprogrammable game packages. That might take some doing.
