STS Holding S.A.-New Horizons and Strategic Changes

STS HOLDING S. A. - a leading sports betting company with a dominant position on the Polish market. Founded more than 20 years ago, STS Holding has earned a reputation as a pioneer in the gambling and sports betting industry.

For its own reasons, the company expands the range of its unique offers day by day, introduces advanced technologies and strategies for customer acquisition and ensures the best service properties.

Significance of Recent Events and Changes

• A turning point came in the company's situation, which had a significant impact on its future development and strategic goals. In 2023, STS's holding was acquired by the international company Entain for the required amount of $946 million. The acquisition allowed STS to introduce advanced technologies and best practices used by Entain, which increased its competitiveness in the market.
• The change in leadership of STS will play an important role in its subsequent development. The appointment of Radim Harza as CEO marks a new chapter in the development of STS, and he will oversee the soft integration and synergies between STs and Enter CEE, resulting in a sustainable and prudent growth of STS. Mateusz Juroszka, previously General Manager, will remain at STS as Chairman of the Supervisory Board, ensuring continuity of strategic management and the implementation of long-term goals.
• The launch of new searches indicates the company's attraction to diversify its assets and ensure a steady increase in profits. Investments in technology, electricity trading and real estate are aimed at preparing a sustainable and profitable pipeline of assets that will strengthen ST's economic strength.

These configurations and strategic initiatives highlight the key role of addiction and innovation in an advanced competitive environment. These provide opportunities for Sts S. A. to hold. It is not only to defend its prominent position in the market, but also to expand its effectiveness by effectively exploiting emerging opportunities.

Acquisition of STS Holding S.A. by Entain

In 2023, Entertain, a veteran in the sports rates and gambling industry, completed the acquisition of STS Holding S. A. for $946 million. This strategic move is part of Entertain's broader plan to strengthen its presence in the European market, especially in Poland, where STS has a strong position. The acquisition demonstrates Entertain's desire to expand its portfolio and leverage STS's vast customer base and established brand reputation. By integrating STS's business, Entertain plans to bring together advanced technology and experience to improve service quality and operational efficiency.

The objectives of this acquisition are as follows:

• Market expansion: Entertain aims to leverage STS's existing customer base and market position to strengthen its presence in the Central and Eastern European market, particularly Poland.
• Technology integration: By integrating STS's business, Entertain plans to introduce advanced technologies and platforms to improve user experience and business metrics.
• Revenue growth: Entertain will secure revenue and margin growth through cross-sales opportunities and market penetration by leveraging STS's market position.

Impact on STS Shares and De-listing Process

Following the acquisition announcement, Entertain launched and successfully concluded a tender offer to acquire approximately 99. 3% of the total joint shares of STS from existing shareholders. The acceptance of such a high percentage offer resulted in a smooth transfer of ownership and laid the foundation for the next stage of the strategic integration.

As part of the acquisition process, Entertain has initiated the process to delist STS shares from the Warsaw Stock Exchange. Delisting is an important step to simplify the business integration and align STS's corporate governance with global Entertain standards. This includes obtaining the necessary approvals from the Polish financial regulator, transparently communicating with STS shareholders about the timing and procedures for delisting, and integrating STS's business under Entertain's management to achieve business continuity and strategic compliance.

The acquisition and subsequent delisting will mark a transitional period as STS becomes an integral part of Entain's vast global business. Such a strategic alliance is expected to generate significant synergies and long-term growth for both companies.

Leadership Changes

In December 2023, STS Holding S. A. announced that Radim Haruza, already CEO of Entain CEE, would become the new CEO of STS. Haruza's extensive skills and track record in the gaming and gambling industry means that his dual role will accelerate the integration of STS and Entain, driving growth and innovation through synergies. This strategic move aligns STS's operations with Entain's social awareness and strategic vision, keeping STS at the forefront of a rapidly evolving market.

Following the change in management, Mateusz Juroszek, former CEO of STS, now holds the position of Chairman of the Supervisory Board and joins the Board of Directors of Entain CEE. His unmatched talent and careful planning in the Polish gambling market played a decisive role in Entain CEE's triumph. Juroszek will continue to play a key role in determining the strategic direction of STS and Entain CEE. As Chairman of the Supervisory Board, he will oversee the implementation of strategic initiatives and ensure the achievement of long-term goals.

In light of the integration with Entain, Mateusz Juroszek defined a number of strategic objectives and structural changes for STS. In his comments, he emphasized the need to increase the expansion capabilities in Central and Eastern Europe while maintaining leadership in the Polish market. He also emphasized the importance of leveraging Entain's technological and operational skills to strengthen STS's offerings and improve customer service.

The main objectives of STS are:

• Introduction of technology: By introducing Entain's latest technology and gaming platforms, CTC wants to provide its customers with an exceptional gaming experience.
• Geographical expansion: STS plans to enter new markets in Central and Eastern Europe to spark recovery and diversify its profit sources.
• Improve operational productivity: CTC aims to increase cost productivity and joint productivity by streamlining its own operations.
• Strengthening customer focus CTC aims to improve customer engagement and satisfaction by providing personalized offers and innovative products.

Under Yurošek's direction, the Outcontent Council ensures continuity and strategic direction, while Radim Haruza's operational direction focuses on daily operations and innovation. These configurations of leadership and strategic initiatives show the attractiveness of STS, which preserves its competitive excellence and ensures its relevance for stakeholders on a daily basis in a changing market environment.

Launch of Investment Arm

STS HOLD S. A. has launched a new strategic initiative to establish an investment division, leveraging funds obtained through the initial public offering (IPO) and other financial means. This move was conceived to diversify profit streams and seize opportunities for sharp upside outside the usual sports betting market. The establishment of the investment division is intended to provide long-term economic strength and upside and create a reliable wallet.

The investment offshoot will focus on three main sectors: technology, electricity trading and real estate. These sectors were chosen for their remarkable upside and ability to bring big profits.

STS wants to strategically invest in every section and increase the chances of opening:

• Investments in technology will target innovative start-ups and already have a place to develop new gaming technologies, fake-minds and platforms for data analysis. These efforts are considered to bring the best benefits and synergies with STS's leading cases.
• In the electricity trading field, STS envisions investing in leading platforms and related proposals, taking advantage of the rapid development of the field and growing consumer demand. The partnership aims to implement the current digital makeover for a sustained upswing.
• Investments in real estate will focus on the sale of high-value plans for paid properties, apartment complexes and functional businesses in popular areas. STS wants to achieve the best profitability and capital growth in this field.

These strategic investments are aimed at consolidating STS's position in the market and ensuring long-term profitability in a broad range of sectors of the economy.

Expected Outcomes and Implementation Timeline

This investment project is thought to bring great profits over the next five years. STS believes that the distributed portfolio will increase economic power and become a protection for market volatility. The project adopts a ste p-b y-step approach, and the initial investment will be allocated to established hig h-growth companies to make a profit early, and then gradually diversify in emerging markets and innovative emerging companies.

The success of the STS holding company IPO has injected a large amount of capital to the investment initiative. As a result, the IPO raised about 1, 080 million dollars ($ 266 million), which was the main source of funding for the company's investment activities. This capital is combined with future economic means such as bond issuance and secondary recruitment, and will support and expand investment targets.

IPO not only provides cash, but also increases the name and specific gravity of STS in the money market. In fact, it is believed that such an authority will attract additional investment and partners, and will increase the abilities of the investment team.

These strategic investments are aimed at developing STS holders as a major player not only in sports betting but also in a larger market. STS is working on lon g-term growth and creating shareholder value by utilizing its economic power and market expertise.

Approval by the Polish Financial Supervision Authority

In early 2024, the Polish Financial Supervision Agency (PFSA) approved the listing of STS Holding S. A. from the Warsaw Stock Exchange (WSE). This regulatory authority is an important milestone in the process of integrating STS into Entein's assets. Procedures for abolishing listing include notifications to the market, payment of transactions, and compliance with legal requirements on the transition from STS listed companies to no n-listed companies.

Listing abolition is accompanied by many results for shareholders.

• It affects liquidity because shareholders cannot trade their own promotions in the public market, so they need to sell their own promotions through the listed abolition process or be private.
• The abolition of listing includes a repurchase of promotion stocks at a predetermined price, and shareholders can get an exit strategy that reflects the price of the promotional stock with a premium.
• Next comes a decline in corporate governance and transparency. With the decline in INFA disclosure requests, the probability that shareholders will be familiar with the company's work will be lower than when STS was listed on the stock exchange.
• The separation is expected to bring strategic benefits as STS moves closer to Entain. The integration is aimed at ensuring synergies and operational efficiencies, and indeed the asset opens up long-term upside potential for the company and its stakeholders.

Final thoughts

The acquisition of the STS company Entain and its further listing on the Warsaw Stock Exchange are considered necessary turnaround factors for the company. These measures are considered to have a significant impact on ST's future, for example, skills and difficulties will become clear.

The acquisition is due to the excellent qualities of STS, which are of strategic importance. By becoming part of Entain Mass Satchel, STS will be able to take advantage of the latest technology and high operational efficiency. We believe that the integration will increase STS's market presence and broaden the range of services it offers, as well as allow it to use its rich skill set to drive new technologies and innovations. Entai n-aid could promote STS's output into new markets in Central and Eastern Europe, expanding its market and profit streams.

The strategic direction of the new control under Entain's management would be promising. By identifying the difficulties of integration and meeting legal requirements, STS could increase its personal potential and reach new heights in competition.

To understand how STS will develop in 2023 and 2024, take a look at the absolute valuation of S. A. for the economic year 2022.