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Chris Hughes

Private Equity's Poker Face Yields a Jaw-Dropping Payout

Stars may struggle to come anywhere close to matching CVC's returns on Sky Bet.
Photographer: Stu Forster

The house wins. Private equity has hit the jackpot with a deal to sell Sky Betting & Gaming to Canada's Stars Group Inc. for $4.7 billion. The jaw-dropping returns achieved here are down to a dose of good fortune as much as judgement.

CVC Capital Partners bought an 80 percent stake in the business from its founder, U.K. satellite broadcaster Sky Plc, in 2015. That transaction ascribed this fledgling business an enterprise value of 800 million pounds ($1.1 billion). CVC recouped its approximate 300 million pound starting equity investment via a dividend last year.