LeoVegas Gives up Malta Relocation because of Cost-Cutting Initiatives
LeoVegas’ planned relocation to Malta is, it seems, of the table. The casino operator has announced that the move will not happen due to serious cost-cutting initiatives.
Furthermore, the operator announced the migration of Rocket X brands to the operator’s platform. Both decisions are the result of several cost-cutting initiatives ahead of strategic measures that will appear in the UK soon.
No Corner Office?
Thanks to the cancellation of the office contract in Malta, the company expects to save €1.7m per year. As you know, the new office was supposed to be bigger than the current facility. LeoVegas opted to stay in the existing facilities for the next five years instead of moving to Malta in 2021.
The brands that belong to Rocket X will soon appear on LeoVegas’ multi-brand platform Rhino. LeoVegas owns and operates all of Rhino’s technology. As announced, the casino brand expects to save around €2m in the UK annually.
These initiatives will “create optimal conditions to be successful in the large, but at the same time complex, UK market”. Gustaf Hagman, LeoVegas CEO, said:
“The consolidation of brands into the same platform will contribute to large economies of scale in the group.”
He believes that that is achievable through multi-brand technology and a more efficient organisation.
Preparing for the New Year
Last year was a success for LeoVegas and Rocket X. The second half of 2019 saw a fantastic performance of both brands. The new structure is for Hagman a good “starting point” for better “growth and profitability” in the UK in 2020.
With all initiatives taken into consideration, LeoVegas anticipated annual cost savings of €3.7m. LeoVegas saves a big chunk of that money with the cancellation of the Malta office. However, as LeoVegas explains it, the sum would be higher if not for Royal Panda’s withdrawal from the UK.
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