FDJ in talks to buy Kindred Group for $3.8b: WSJ

The news: La Française des Jeux (FDJ) has offered to buy Kindred Group for around USD2.5 billion ($3.8 billion), potentially forming one of Europe's largest online gambling companies, the Wall Street Journal reported.

The numbers: The cash offer is expected to be announced on Monday, with French casino and gaming company FDJ seeking to acquire Stockholm-listed Kindred, which has a market value of over USD2.1 billion. FDJ, which reported a 6% lift in half year profit through June to almost €1.3 billion ($2.15 billion), bought Ireland's national lottery operator Premier Lotteries Ireland for €350 million in November. After a temporary withdrawal of operations in the Netherlands, Kindred reported a 30% drop in quarterly revenue and a stock price decline in recent weeks.

The context: The acquisition would expand FDJ's gambling operations in new European markets including the UK, France, Italy, the Netherlands and Sweden, as well as in Australia. New York activist investor Corvex Management, owning 15% in Kindred, previously called for the company to consider a sale to boost its stock price.