Kindred Group has most recently announced that it will be suspending its North American operations. The company operates the leading iGaming brand Unibet in Ontario and several United States territories reported that it will be leaving those markets by Q2 of 2024. This means that it will be cutting over 300 employees, resulting in a cost reduction of £40M.
Its brand Unibet was one of the first operators to go live in Ontario’s open market for private online casino and sports betting operators. The sector kicked off operations on April 4, 2022, and it was the first Canadian province to open up its market for third-party brands. It was done to stop residents from pouring millions into unregulated websites every year.
Cost Reductions are Needed, Explains Interim CEO
Interim CEO of Kindred Group, Nils Anden said in a statement that the cost reduction undertakings are both necessary and decisive for the gambling corporation. She said it was never good to say goodbye to valued employees. Still, it puts the company in a stronger position to secure long-term growth across locally regulated and core jurisdictions.
Its Unibet brand was headed by Canada Country Manager, Amanda Brewer, and was one of the first operators to go live in Ontario’s market in April 2022. Ms. Brewer who had a massive part with the Canadian Gaming Association as a Senior Advisor and helped establish the province’s regulated iGaming sector, announced that she will depart from the company in October 2023.
Meanwhile, the corporation’s latest quarterly earnings report also supports its decision as it demonstrates its turbulent times in North America. For the first three quarters of 2023, the company reported underlying EBITDA losses of £17.1 million, which is why it will now concentrate on other markets across the globe.
Ontario’s Market is Over-Saturated
Ontario’s open market has seen the licensing of over 47 operators since the launch of the iGaming framework in April 2022 and experts have predicted a cool-off in the province. In March 2023, Coolbet Canada became the first operator to suspend activities in the province, as the operator admitted that business in the jurisdiction has been slower than expected.
The iGaming operator explained it was putting the maximizing of profitability first as well as the investment capital and resources into only the highest return regions. However, the operator does not see a near-term path to profitability in Ontario. Meanwhile, the company’s license in the province expired on April 3, 2023, just months after its official entry.
Shortly after the announcement from Coolbet, GAN Ltd. which owns the betting brand shed more light on what went wrong for the firm in Ontario. It said it was plagued by a competitive, promotional-oriented obsession in the first few months of operations, and that it was dominated by new entrants and gaming brands that were previously operating in the grey sector.