World’s second-largest gaming and sports betting firm being formed as CIRSA merges into Lottomatica, backed by Blackstone

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The Backstory

Scale becomes the industry’s defining currency

Lottomatica’s planned €2.8 billion acquisition of CIRSA lands in a market where size, technology and regulated-market access increasingly determine who can compete across sports betting and online casino. The combination would create a Rome-domiciled group with major positions in Italy and Spain, a meaningful Latin American footprint and enough earnings power to rank behind only Flutter among listed gaming and sports betting companies by valuation.

The transaction also reflects a broader reset in global gaming. Operators and suppliers are using mergers, divestments and targeted acquisitions to sharpen portfolios, improve margins and secure access to audiences or jurisdictions where growth remains available. In that context, the Lottomatica-CIRSA deal is less an isolated consolidation move than part of a wider industry response to higher capital costs, tougher regulation and investor pressure for cash generation.

The proposed group’s mix illustrates the strategy. About 80% of adjusted EBITDA would come from Italy and Spain, two mature, regulated European markets where local scale matters. The rest would come from markets including Panama, Colombia, Mexico, Peru, the Dominican Republic, Costa Rica, Paraguay, Portugal and Morocco. Online and sports betting would account for nearly half of adjusted EBITDA, with casinos and distributed gaming supplying the balance. That diversified structure gives the combined company multiple levers but also exposes it to several regulatory systems and consumer-protection regimes.

CIRSA had already been building toward regulated-market expansion

CIRSA’s role in the transaction is not only as a Spanish asset backed by Blackstone. It had been expanding its regulated-market presence, particularly in Latin America, where online gaming growth has been accompanied by efforts to formalize licensing regimes. Its recent move into Paraguay through a majority stake in Slots del Sol showed the same playbook now being scaled inside Lottomatica.

In that deal, CIRSA entered Paraguay’s online gaming market through Slots del Sol, an operator with a digital casino platform, two casinos and two gaming halls. CIRSA cited Paraguay’s regulatory framework and the target’s local operating knowledge as reasons for the acquisition. The move followed amendments to Law No. 7348/2025, which opened the market to private operators after a long-standing monopoly, and came as the country reported record gambling revenue.

That history helps explain why Lottomatica is emphasizing the combined company’s ability to replicate its online execution across CIRSA’s digital operations. CIRSA brings not just land-based assets and Spanish scale but access to developing regulated markets where online penetration may rise faster than in mature Europe. Lottomatica brings a track record in online betting and gaming in Italy. The strategic premise is that technology, product discipline and centralized operating methods can lift CIRSA’s margins and accelerate growth across markets where it already has local footholds.

Blackstone’s hand signals private capital’s shifting priorities

Blackstone’s position is central to the deal. As CIRSA’s main shareholder, the private equity firm will become the largest investor in the merged company with a 24% stake. That structure allows Blackstone to retain exposure to a larger listed platform while crystallizing a path for CIRSA beyond private ownership. It also gives Lottomatica shareholders control of roughly 67% of the combined business while adding an investor with deep capital markets influence.

The deal fits a period in which Blackstone has been reassessing holdings across the gaming ecosystem and adjacent businesses. The firm has also been reported to be pursuing a sale of Clarion Events, the trade show organizer behind ICE, after acquiring the company in 2017. Blackstone’s reported sale process for ICE organizer Clarion Events underscored how private equity sponsors are seeking to monetize assets that recovered from pandemic disruption and returned to growth.

Clarion’s experience was different from CIRSA’s operating model, but the common thread is capital rotation. Private equity investors that bought gaming or gaming-adjacent assets before the pandemic are now weighing exits, partial exits or public-market structures as valuations recover unevenly. In CIRSA’s case, Blackstone is not leaving entirely. Instead, it is rolling into a larger platform that promises €2 billion in adjusted EBITDA, €115 million in run-rate cost synergies within three years and shareholder returns that management has said could total up to €4 billion over three years.

Portfolio discipline is reshaping European operators

The Lottomatica-CIRSA merger also comes as other large operators streamline rather than expand indiscriminately. Entain, one of the largest global betting and gaming groups, recently moved in the opposite direction by beginning a phased exit from its Central and Eastern Europe business. Entain agreed to sell a 20% interest in Entain CEE to EMMA Capital for €425 million, valuing that business at about €2.1 billion.

Entain said proceeds would be used to reduce debt and that it would continue evaluating options to exit its remaining minority stake. The move followed a period of expansion in Croatia and Poland, including the SuperSport and STS businesses, but the company framed the divestment as capital discipline and value unlocking. It also adjusted financial guidance to reflect that it would no longer recognize its share of Entain CEE profits and dividends until a full exit is achieved.

That contrast is instructive. Lottomatica is increasing its concentration in markets and verticals where it believes it can exert operational control and generate synergies. Entain is reducing exposure to a regional joint venture to cut leverage and simplify the story for investors. Both moves respond to the same market demand: clearer portfolios, stronger free cash flow and credible leverage management. For Lottomatica, the test will be whether acquisition scale translates into integration gains without diluting the performance that made it attractive in the first place.

Media, data and online growth raise the competitive bar

Scale is no longer limited to licenses and retail networks. The online betting market increasingly rewards companies that control data, customer acquisition and media inventory. That trend is visible in supplier and media consolidation as well as operator mergers. Genius Sports’ planned purchase of Legend, a sports and gaming media network, shows how companies are trying to own more of the fan funnel before users reach a betting app.

Genius Sports’ agreement to acquire Legend was valued at up to $1.2 billion, including $900 million at closing and a potential $300 million earnout. Genius said the acquisition would add a large digital audience, improve monetization and support higher margins. Legend’s network generated 320 million annual visits in 2025 from 118 million unique visitors, providing a direct channel to fans researching scores, odds, teams and players.

For operators such as the future Lottomatica-CIRSA group, that development matters because customer acquisition costs remain a central pressure point in online betting. A larger balance sheet and broader geographic spread may help fund technology and marketing, but rivals and suppliers are also building integrated platforms that shape how betting demand is captured. Lottomatica’s goal of accelerating CIRSA’s online operations will be judged partly against that backdrop: online execution is becoming as much about data, personalization and media efficiency as about brand presence.

Regulatory pressure remains the counterweight to growth

The combined group’s regulated-market focus may reassure investors, but regulation can also constrain the very products driving online growth. In the U.S., Pennsylvania has become a prominent example of a mature gambling market reconsidering how online betting and gaming should be marketed and monitored. A bipartisan state commission and the Pennsylvania Gaming Control Board recently recommended tighter rules aimed at problem gambling, advertising, self-exclusion and inducements.

Pennsylvania’s review of online gambling rules singled out concerns around in-play betting incentives and micro-betting, reflecting broader unease about products designed for rapid engagement during live events. The state’s recommendations included restrictions on terms such as “free” or “risk-free,” limits on credit card use, tighter controls on VIP programs and more analysis of anonymized player data to identify harmful offerings.

Although Pennsylvania is not one of the Lottomatica-CIRSA group’s core markets, the policy direction is relevant globally. Regulators in established jurisdictions are scrutinizing online engagement tools, targeted marketing and player incentives. The merged company’s exposure to Italy, Spain and other regulated markets may provide stability, but it also means its growth plans must fit within tightening consumer-protection expectations. The strategic bet behind the merger is that a larger, more diversified operator can absorb those pressures better than smaller rivals while still investing in product, compliance and shareholder returns.