Kindred to Withdraw Unibet from U.S. and Canadian Markets
Kindred Group has announced it will be leaving North American markets by Q2 2024. The Sweden-based gambling operator currently operates its Unibet brand in four U.S. states and Ontario, Canada.
This move comes as part of Kindred’s ongoing strategic review aimed at refocusing efforts on core markets and driving profitable growth. The group’s Q2 2023 report showed positive results overall. But the U.S market lagged behind its efforts in Europe.
The withdrawal is now confirmed, despite Kindred’s significant investment in the U.S. market this year. That included opening retail sportsbooks in Washington state and Arizona, and upgrading its online casino services in New Jersey.
However, May 2023 also saw four top Kindred executives resign in the space of a month. That included the abrupt departure of former CEO Henrik Tjärnström and CFO Johan Wilsby.
The new appointed interim CEO, Nils Anden, is still in the role some six months later. In a press release, he spoke on the news of Kindred’s departure from U.S. markets, which will see 300 jobs lost. This reduction is expected to save the company approximately £40 million annually.
“The cost reduction actions announced today are both necessary and decisive. While it is never a desire to inform valued colleagues of redundancies, this puts us in a stronger position to secure long-term growth for Kindred across our locally regulated core markets,” Andén said.
“We can now focus our resources and tech capacity towards strategic initiatives and selected markets where we see clear potential to grow our market share.”
North American Market Exit
Kindred Group, which operates the Unibet Sportsbook and Casino brand, initiated an initial strategic review of its global operations in April, aimed at refocusing and accelerating profitable growth.
The new decision to exit North American markets includes withdrawing Kindred’s presence among online casinos in Arizona, Indiana, New Jersey, Pennsylvania, and Virginia.
The exit was foreshadowed in 2022, when the operator withdrew from the Iowa sports betting market. Kindred execs said at the time this would help it focus on multiproduct U.S. states that offer sports betting and online casinos.
Andén, who replaced former CEO Henrik Tjarnström, is leading the ongoing strategic review, despite not yet taking up the head role permanently.
Kindred has been operational in the U.S. since 2019, when it was one of the first foreign operators to launch among online casinos in Pennsylvania and New Jersey. However, despite getting an early start, it has struggled to gain market share against the top U.S. competitors that have since emerged, such as DraftKings and FanDuel.
Refocusing Efforts and Potential Sale
Following the North American exit, Kindred plans to redirect its focus to its well-established markets in Western Europe and the Nordic region. In recent times, Kindred has experienced a loss of market share in its home market of Sweden and in key European markets like the UK.
The company aims to initiate growth initiatives in these core markets by expanding hyper-local casino brands, reallocating marketing investments and tech resources to core European markets, and differentiating its products through exclusive content.
The operator has reported decent growth throughout 2023 so far. But a lot of that was carried by its operations in the Netherlands, where Unibet is the leading operator.
While the strategic review is still ongoing, Kindred has left the door open for a potential full or partial sale of the business.
“The strategic review initiated by the board remains ongoing, and we continue to advance a number of options to deliver shareholder value,” Andén said.
“The board currently believes that shareholder value will be maximized through a third-party transaction. We will provide a further update regarding the exploration of strategic alternatives when final decisions have been made by the board of directors.”