“Red Roses and Slain Dragons”

A presentation by Tim Stocks, Chairman James Stocks & Co and Partner Taylor Wessing LLP

23 April 2015

2

2

Our view remains that the European online gaming sector will consolidate in the near term as falling industry growth rates in the UK/Europe, rising

marketing costs, increased gaming taxes and rising competition makes scale a increasing necessity to compete more effectively.

“”

– Deutsche Bank (February 2015)

3

3

Others

Playtech PlcIntertain Group William HillLadbrokesBetsson

PE InvestorsAmaya Inc Scientific Games Bally Technologies

There has been a slew of M&A activity in the industry over the past two years with a wide participation (i.e. by most of the key players)

BUYERS

Note: 1) The size of the bubble depicts the deal value of all transactions in GBP terms

Source: Thomson One; Capital IQ; Press Search

Sky Betting£720mn

WMS Industries£896mn

Bally Technologies£3,041mn

Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15

Rush Sports AB£0.2mn

Class One Holding Ltd£116mn

WagerLogic£54mn Betstar Pty Ltd

£12mn

YoYo Games£14mn

Aristocrat Leisure–Lotteries£8mn

NetPlay TV Plc£12mn

Macau Live

Gaming£238mn

Gaming Innovation Group£48mn

Game Lounge£3mn

Betfair Australasia Pty Ltd£6mn

Dumarca Holdings£74mn

Tom Waterhouse£20mn

Dragonplay Ltd£60mn

Pokerstrategy.com£31mn

Diamond Game Enterprises£16mn

Global Betting Exchange Ltd£16mn

Deal Timeline1 (2013–Present)

William HillOnline

£424mn

Sporting bet Australia£459mn

Rational Group£2,907mn

IGT£3,591mn

Gamesys£426mnChelbis Company

£2mn

4

4

The global online gambling market is expected to grow at a CAGR of 10.6% during 2014–2018

Note: 1) Online Gambling Market comprises of remote gaming activities by means of internet (desktop-based as well as mobile); market is synonymously referred as online gaming sector

Source: ‘Global Online Gambling’, MarketLine (February 2015); H2 Gambling Capital; ‘Online Gaming Should Continue Its Winning Streak in 2015’, Dundee Capital Markets (January 2015)

Europe Online Gambling1 Market – by Value2,3

(£ billion, 2009–2018E)

2009 2010 2011 2012 2013 2014E 2015E 2016E 2017E 2018E

8.49.7

10.8

11.7 12.713.9 14.6 15.5 16.1 17.018.2%

14.7%

11.3%

8.8% 8.7% 9.1%

5.2% 6.0%3.8%

5.4%

Market value Y-o-Y Growth

Global Online Gambling1 Market – by Value2,3

(£ billion, 2009–2018E)

2009 2010 2011 2012 2013 2014E 2015E 2016E 2017E 2018E

16.5 18.4

20.2

21.8 23.7 25.027.6

30.633.8

37.411.8%

9.8%

7.6%8.6%

5.7%

10.5% 10.7% 10.7% 10.5% Market valueY-o-Y growth

CAGR: +9.4% Expected CAGR: +10.6%

European online gambling industry to grow at a CAGR of 5.1% during 2014–2018, but at declining Y-O-Y growth rates

H2 Gambling estimates the UK online gambling market at £2.44bn2, with a majority of the activity regulated offshore

5

5

Online players have higher operating margins than the retail players

Key Players1 Total Online EBIT2,3

(£ million, FY2012–FY20144)

FY2012 FY2013 FY2014

400.6481.7

604.2

Note: 1) Nine players included for the analysis are William Hill PLC, Unibet Group PLC, 888 Holdings, Betfair Group, Betsson, Bwin.party, Paddy Power, GVC Holdings and 32RED PLC2) EBIT figures and margins have been sourced from Capital IQ, which makes adjustments for non-operating and non-recurring items; Online margins have been considered for Paddy Power and William Hill which has both—retail as well as online operations (continued in slide note)

William Hill Betsson Paddy PowerUnibet Group Betfair GVC Holdings Average 888 Holdings 32Red Plc Ladbrokes Bwin.party

34%

27%23% 21% 20% 20% 18% 18%

11%7%

1%

Online EBIT Margin – by Operator(%, FY2014)

Average EBIT Margins – Online vs. Retail Operators5

(FY2012–FY20144)

FY2012 FY2013 FY2014

17.5% 17.1%

19.3%

14.3%15.3% 15.3%

Online Players Retail Players

Source: Capital IQ; Bloomberg

Online operator margins, though higher than the land-based players, are close to 15%—implying a cost base that is unsustainable in a rising cost environment

With an additional charge of 15% (POC tax) levied on online gambling operators by the UK, operators with low EBIT margins will struggle to exist

6

6

Marketing Expenditure1 as a % of Revenue – By Operator (FY2014)

Note: 1) ‘Selling and marketing expenses’ line item has been taken in case ‘marketing expense’ was not available in the company’s financials

Paddy Power

William Hill PLC

Unibet Group PLC

Betsson

Betfair Group

32RED plc

888 Holdings

Bwin.party

10%

13%

24%

28%

29%

33%

35%

36%

On an average, investments in marketing constitute more than one-fourth of online gambling operator’s revenue base

Marketing expenditure contributed close to one-third of online gambling operators’ cost base

Source: Capital IQ

Average: 25.7%

7

7

An increasing number of European countries’ online gambling markets have become regulated with rest considering regulatory changes

January 2010 January 2014

Online regulated Online regulated - monopoly

Online regulation being drafted/reviewed

Online regulation planned/considered

No online regulation

Source: ‘Online betting and gaming regulation 2014’, PWC (February 2014)

8

8

While three US states have legalised online gambling for its residents, there is a big “question mark” on whether other states will follow suit or come a federal regulation

Quite unclear and complex gambling-related regulatory framework― While gaming is legal under federal law, there exists a state-by-state regulation wherein each state is free to put restrictions within its borders; also, all

forms of gaming are not legal across all states Residents of non-regulated states can use websites licensed in an online gambling jurisdiction outside of the US The existing intra-state gambling severely limits the pool of players; hence, a move towards inter-state online gambling regulated at the federal

level—which increases liquidity with a larger number of players—will be looked for as a major growth catalyst Morgan Stanley estimates the US online betting market at £274.7 million by 2017, one-third its initial estimate of £0.9 billion on the back of

lower-than-expected revenue from US in 2014 (actual: £93.1 million; estimated: £454.3 million)

Source: Legal US Poker Sites; ‘US Online Gaming: Cutting Market Estimates; Downgrade BYD to Equal-weight’, Morgan Stanley (September 2014) (continued in slide note)

Note: 1) Though no direct laws have been launched in New York , debates over maintaining status quo with legalized commercial casinos improves the chances

Nevada(Apr 2013)

NJ (Nov 2013)

Delaware (Nov 2013)CA

PA

IL

NY

Regulated gambling sites exist only for residents of three states—Nevada, Delaware and New Jersey—where online gambling is legal

States where online gambling is legalised (3)

States which plan to legalise online gambling1 (4)

Colour coding

9

9

More than a trillion pounds of cash funds available with the PE funds, a portion of which can go to the increasingly lucrative online gambling sector

Gambling focused PE Funds – US vs. UK vs. Europe(£ billion, April 2015)

Total Funds Raised Last 10 yrs Est. Dry Powder

63.7

18.9

42.6

11.6

56.8

13.8

US focused UK focused Europe focused

All PE Funds – US vs. UK vs. Europe(£ billion, April 2015)

Total Funds Raised Last 10 yrs Est. Dry Powder

1,698.3

495.8718.0

183.2

1,519.9

427.3

US focused UK focused Europe focused

US focused PE funds have raised the maximum amount in the last 10 years, followed by the Europe-focused and then UK-focused funds The estimated “cash-like” Dry Powder—amount of committed capital that have not been called for investment by the GP—of above £10 billion in

each of the three regions (US, UK, Europe) with gambling focused PE funds indicate at a large wall of money that can come in gambling sector

Private Equity Assets Under Management (AUM) – Global(£ billion, 2000–2014)

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 June 2014Dry Powder Unrealised Portfolio Value

480 503 514 580 642827

1,135

1,517 1,5211,655

1,8342,031

2,1922,425 2,538

Source: Prequin Database; ‘2015 Preqin Global Private Equity & Venture Capital Report’, Prequin (January 2015)

The PE industry’s AUM stands in excess of £2.5 trillion as on

June 2014, which grew at a CAGR of 9% during 2009–2014 on the back of growing unrealised portfolio value of PE and VC

assets

10

10

Large land based operators (LBOs) offering e-gaming services to complement their retail operations

2012 2013 2014

83% 84% 81%

17% 16% 19%

Ladbrokes revenue–by segment(£million, 2012-2014)

Land based Online

1,104 1,1481,044

2012 2013 2014

58% 52% 45%

42% 48% 55%

Cherry AB revenue–by segment(£million, 2012-2014)

Land based Online

22 25 27

2012 2013 2014

67% 67% 63%

33% 33% 37%

William Hill revenue–by segment(£million, 2012-2014)

Land based Online

1,4391,3531,245

According to H2 Gambling Capital, e-gaming sector is expected to constitute 11% of global gambling gross wins by 2018

The growth in e-gaming has complemented and not substituted traditional retail gaming― Different player profile (new-age customers for online gambling)

ensures that importance of LBOs has not decreased Increasing clarity in global e-gaming regulations has further

encouraged land-based casino operators to enter or diversify their presence in digital space― Well-established players have a competitive advantage given they

do not have to spend huge marketing expenses― Absence of any physical cost in online operations enables ease in

expansion of services to more geographies

Growth in the share of online revenue indicates its increasing importance and the shift in focus of land based operators

Source: H2 Gambling Capital; Capital IQ

Online Gaming Gross Win as % of Total Gaming Gross Wins – Global($ million, 2007–2010)

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

E

2015

E

2016

E

2017

E

2018

E

3%4%

5%6% 6%

7%7% 8% 7% 8% 8% 9% 9% 10%

10% 11%

11

11

UK LBOs focus on high growth Australian e-gaming market due to POC tax

Most of the recent transactions saw large British LBOs expanding their operations in other regulated markets, primarily Australia, amid concerns over rising costs of operating online betting businesses in the UK (anticipated POC tax)― Australia leads global online gambling market in terms of per person gaming and sports betting

Due to ambiguity in e-gaming laws, US LBOs are not inclined towards expanding their operations in global e-gaming market

Announced date Target Target

Nation Acquirer Acquirer Nation

Deal Value (£m) Rationale

Aug-14 Betfair Australasia Pty Ltd (JV with betstar) Australia Crown Resorts Ltd Australia 5.6 Acquired remaining 50% stake to revive the loss making

business

Apr-14 Betstar Pty Ltd (Eskander) Australia Ladbrokes UK 12.4 Expanding its operations in Australia

Aug-13 Tom Waterhouse Australia William Hill UK 20.4 Expanding presence in Australia

Mar-13 Sportingbet-Australia Business Australia William Hill UK 459.0 Expanding its operations in Australia

Jan-13 Global Betting Exchange Ltd Ireland Ladbrokes UK 16.1 Increase digital revenues and investment in IP

Jan-13 William Hill Online (JV with Playtech) UK William Hill UK 424.0 Acquired remaining 29% stake in JV, William Hill online, with

Playtech to obtain operational freedom for its digital business

Source: Thomson One; Bloomberg Business; The Telegraph

12

12

Social gaming to be a key growth driver amid rising mobile and tablet penetration

Land Based91% Digital

9%

Source: Eilers Research; ‘Social Gaming’, Morgan Stanley (November 2012); ‘The Mobile Economy’, GSMA Intelligence (2015)

Contributing £1.1billion1 to the total of £23.5billion1 e-gaming market, social gaming is expected to reach £4.7 billion1 by 2015― Basic feature of virtual money has constrained monetisation of social

gaming Free from shackles of legislature, social gaming is expected to

flourish in geographies where real-money online gambling is restricted

North America has the largest share in total social gaming market (40%), followed by Europe and Asia― Social gaming forms 5% of the global e-gaming market, except North

America where it contributes 10% to the total online gaming market

2007 2008 2009 2010 2011 2012E 2013E 2014E 2015E

7.4%8.4% 8.5%

9.4%10.3%

12.5%

14.3%15.6%

16.6%

Mobile Gaming as % of Global Online Gambling Market2(2007-2015E)

According to GSMA intelligence, global mobile connections increased from 4.1 billion in 2008 to 6.9 billion in 2013, moving at a CAGR of 11.3%; the industry is expected to reach 8.5 billion in 2017 with Asia Pacific forming more than 50% of the connections― Globally, mobile penetration is higher than internet penetration

With high growth in mobile and internet industry, mobile gaming is expected to reach 16.6% of the total e-gaming market in 2015

Note: 1) All currency conversions are at USD 1 = GBP 0.67 as of 9th April 20152) Global Online Gambling Market has been valued based on the gross gambling yield

Social gaming 5%

Online gambling 5%

Global Gambling Market Revenue – Breakup(2012)

Mobile gaming is forecasted to contribute 81% of social casino’s revenue in 2017

13

13

Players ranging from online gambling operators to gaming software providers are trying to grab a piece of social gaming space

Announced date Target Target

Nation Acquirer Acquirer Nation

Deal Value (£m) Rationale

Jun-14 Dragonplay Israel Bally Technologies US 59.5 To help position Bally Bally at the forefront of social casino gaming

Dec-12 Buffalo Studios LLC US Caesars US 31.4 Widen the social and mobile game assets

Nov-12 Product Madness Inc US Aristocrat Leisure Australia - Strengthen its online business by entering into social gaming

May-12 Orneon Ukraine Bwin Party Gibraltar 14.7 Enter into free-play social gaming part as a of its social gaming push strategy

Jan-12 Double Down US IGT US 326.4 Provide IGT with immediate size and scale in free-to-play gaming industry

May-11 Playtika Israel Caesars US - Caesars initially acquired 51% of Harrah’s social casino with rest being acquired in just a span of few months

Jun-10 Mytopia US 888 Holdings UK 12.4 Giving 888 entry into social games and provide exposure to different online gaming platforms

Social gaming market helps online gaming companies to offer their services in unregulated markets, such as Asia and the US, acting as a driver for the ongoing consolidation― Majority of the recent transactions involved US companies

Source: Thomson One; Capital IQ; Press search

“At the end of the day social becomes the early funnel for real-money. In other words, people who are playing Zynga Poker are not necessarily going to play real-money poker, but their propensity to play real-money poker is probably about 50 times higher than the general public” –

Gigi Levy, Playtika Investor

“At the end of the day social becomes the early funnel for real-money. In other words, people who are playing Zynga Poker are not necessarily going to play real-money poker, but their propensity to play real-money poker is probably about 50 times higher than the general public” –

Gigi Levy, Playtika Investor

14

14

Increased regulation in e-gaming industry has led to a convergence in B2B and B2C online gaming segments

Source: Thomson One; Press search

B2B diversifying in B2C segment

December 2014: Contagious Gaming acquired Malta based Chelbis Company Ltd, an online gambling operator for £2.3 million

June 2014: Amaya acquired US based Rational Group, owner of Poker stars and Full Tilt poker brands for £2.9 billion─ With the disposal of Ongame and Cadillac Jack, the company seems to be entering

into B2C segment and plans to launch in-house sports betting February 2015: Nio Inc. acquired Gaming Innovation Group (GiG), owner of

Guts.com and iGaming Cloud platform developer, for £47.9 million

Online gambling software providers are acquiring e-

gaming operators in regulated geographies

Trend Software Transactions Comments

B2B expansion

September 2014: Playtech acquired Aristocrat’s Lottery business, providing gaming platform for VLTs and casino markets in Norway and Italy, for £8.3 million

August 2014: Scientific Games acquired Bally Technology, a US based slot machine manufacturer for £3.0 billion

July 2013: Amaya acquired Diamond Games Enterprises Inc, primarily operating in North-America lottery industry, for £15.9 million

GTECH Spa acquired IGT, a US based gaming machine and online and mobile gaming solutions provider for £3.6 billion

2011–2012: Playtech’s European acquisition of betting and e-gaming software providers—Geneity Ltd, Ash Gaming Ltd, Mobenga Ltd—for the total of £54.9 million

Acquisitions of companies in similar business helps firm

achieve larger geographical footprint, greater product

offerings and increased customer base of online as well

as land-based gambling operators

Snapping up affiliates

January 2015: Cherry AB acquire 51% in Game Lounge, a Malta based affiliate marketer for £2.6 million

July 2013: Playtech acquired Pokerstrategy.com Ltd, a Gibraltar based online poker affiliate site, for £31.4 million

Ramping up marketing affiliates would help company increase

their customer base and expand marketing opportunities

15

15

Amaya and Playtech, the two big suppliers to the online operators, are actively acquiring to diversify their operations

Playtech Plc

April 2015: Seeking acquisition of Trade FX Ltd, a UK based trading platform and payment services provider for £336 million

January 2012: Acquisition of Geneity Ltd, a London based bookmaker and lottery software provider

2011: Acquisition of various online gambling software provider such as Ash Gaming Ltd, Mobenga AB and Intelligent Gaming

Solution

Amaya Gaming Group

2014-2015: Disposed off Cadillac Jack and Ongame Network Ltd, both acquired in 2012

June 2014: Acquisition of Poker stars and Full tilt owner, Rational Group, for £2.9 billion

June 2013: Acquisition of US based online software provider, Diamond Game Enterprises Inc for £16 million

Amaya’s CEO on Rational acquisition “This is a transformative acquisition for Amaya,

strengthening our core B2B operations with a consumer online powerhouse that creates a

scalable global platform for growth”; to complement the transaction, the company

looks to launch an in-house developed sports betting

Playtech has been on an acquisition trail for past four years snapping up several e-gaming

and betting software targets; the company looks to spend £536 million towards future acquisitions leveraging on evolving betting

industry over mobile and tablet

Source: Thomson One; Press search

Software Acquisitions Strategy

An example of B2B going B2C

An example of B2B expansion

16

16

Conclusions

Online gambling sector becoming increasingly established and regulated; hence, investors and lenders ready to inject capital into the sector Companies are seeking to position themselves as leaders in regulated territories which increases valuations; thus, acquiring several online brands

to expand their customer base across different gaming categories With increased costs of customer acquisition, competition and changes in the taxation environment (an increased tax burden)— scale is

increasingly important and those without scale will struggle to fund marketing expenses over time, eventually losing market share Technology and platform providers have also shown interest in launching in-house gambling websites, acquiring B2C companies to scale up their

operation and bring revenue growth

The wave of M&A activity is prompted by:

Europe continues to dominate the global industry but the anticipation of further legalisation on a state-to-state basis in the US presents a significant growth opportunity; any new regulations in currently unregulated high-population Asian markets (China and India) can also bring a change in the industry scenario

The UK POC tax is likely to be a game changer, as other countries might pursue a similar model to earn more tax The push for inter-state and international liquidity sharing contracts can further boost the growth of the industry Mobile and tablet platforms will be increasingly used for online gambling The wall of money attracted to the sector will drive deals and valuations

Outlook

5th Floor, 6 Agar StreetLondon WC2N 4HN

James Stocks & Co Limited Registered address 5th Floor, 6 Agar Street, London WC2N 4HNTelephone +44 (0)7795 426122

Email info@jamesstocks.com Website www.jamesstocks.comAn appointed representative of Culver Financial Management Limited