- The Board proposes that Cherryföretagen is split into three independently listed
- The division is performed to clarify the value of each operation by creating three clear
- Cherry changes name to Betsson
- The proposal for the general meeting is intended to be presented during first quarter
- Cherry is expected 2005 to have a turnover of SEK 435 million (311)
- Betsson (currently Cherry Online) is expected to at least double their turnover during
The Board has determined that the three operational branches could be developed more rapidly and
stronger on their own. A split also gives better transparency of the different businesses and gives
shareholders the possibility to choose their desired risk level and area of operations.
The Internet-based operations will grow more quickly and with a higher profitability in their own
companies, Cherry Casino will receive more attention. I also believe that the market will appreciate
having three clear investment alternatives, says Pontus Lindwall, CEO of Cherry.
In connection with the division, it will be suggested that Cherry change their name to Betsson AB (publ).
The goal of the Board is to present a suggestion outlining the division during the first quarter of 2006
and that the division is to be concluded at the latest during second quarter 2006. The goal is for all
companies to be listed.
The three parts have been proposed as:
- Betsson presently Cherry Online with online gaming via Betsson.com and online casinos
- Net Entertainment development and sales/licensing of games and gaming systems
- Cherry Casino - traditional casino games and gaming machines, mainly in Sweden, Denmark and
The proposal will be formed so Betsson continues its operations under the publicly traded holding
company Cherryföretagen AB (publ). It will be recommended that Cherry change their name to Betsson.
Today, the business areas run independent operations with limited benefits from collaboration. The
cooperations that exist between the business areas have terms adjusted to the market and are
regulated by contracts.
Cherry Online
Within Cherry Online, prospectively Betsson, Internet gaming is operated on the global market, for
instance via Betsson and CasinoEuro.com. The offerings include poker, casino games and sports
betting. There are also plans for other products. The operations are driven from Malta and Great Britain,
both of which have well-regulated gaming markets. Net sales increased during the first nine months of
the year to SEK 101.4 million (18.8), and profits rose to SEK 8.8 million (-2.6). Business is growing
strongly and profitability is good.
Net Entertainment
Net Entertainment develops gaming software for licensing to customers, today consisting of around 30
different gaming companies such as Unibet, Gamebookers, Ongame, Bet24, and 24hpoker. Revenues
consist of royalties and other proceeds from sales. Net sales rose to SEK 36.2 million (26.9) during the
first nine months of the year, and operating profits increased to SEK 26.6 million (16.0). The operations
are growing strongly and show a very good profitability.
Cherry Casino
Cherry Casino operates traditional gaming with Black Jack and roulette at restaurants, gaming on cruise
ships in international traffic, gaming machines and other traditional gaming activities. The bulk of the
operations are run in Sweden and Denmark. Cherry Casino has approximately 700 employees. Net
sales during the first nine months of the year amounted to SEK 177.7 million (182.6), with an operating
profit of SEK 5.2 million (6.4). Cherry Casinos operations have a stable cash flow.
The collaborations between the business areas apply to Betsson who use casino software developed by
Net Entertainment. Betsson also has an agreement with Cherry Casino regarding game distribution.
A division requires approval at the general meeting. A call for an extraordinary general meeting will be
distributed as soon as detailed plans have been determined by the board. The proposal is supported by
shareholders corresponding to more than 70% of the votes.
Cherry Online expects to have a turnover of approximately SEK 155 million during 2005. Net
Entertainment will turnover approximately SEK 65 million (including internal turnover of SEK 20 million)
and Cherry Casino is expected to have a turnover of approximately SEK 235 million for the year 2005.
Betsson expects to at least double their turnover during 2006 and have more than 400,000 members by
the end of the year.
Invitation to a press and analysts conference
On account of this information, Cherry will be holding a telephone press and analysts conference.
Chairman of the Board John Wattin and CEO Pontus Lindwall will be participating in the conference.
Time: 14.30
Telephone number: Call Cherry to receive the telephone number and code; +46 8-506 403 00
For further information, contact:
Pontus Lindwall, President and CEO, telephone: +46 8-556 967 10, mobile: +46 708-27 51 55,
[email protected]