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American Funds Ratchets Up Kindred Group Exposure

American Funds Ratchets Up Kindred Group Exposure

Posted on: September 29, 2021, 10:22h.&nbsp

Final updated on: September 29, 2021, ten:22h.

Kindred Group, the Swedish online gaming operator, stated Capital Group owns 10.53 % of its shares and voting rights as of Sept. 24.

Kindred stock
Unibet parent Kindred is a favorite of some fund issuers. Capital Group continues purchasing shares of Kindred stock. (Image: Stewart-Haas Racing)

The owner of the 32Red, Bingo.com, Otto Casino and Unibet brands, amongst others, created the announcement concerning Capital Group’s stake on Tuesday following getting a notification of “major holdings” from the mutual giant the prior day. Capital Group mutual funds are issued below the American Funds label.

News of Capital Group’s elevated stake in Kindred comes after the Swedish gaming firm was loosely mentioned as a possible takeover target. Mutual fund issuers usually take passive stakes in organizations and generally don’t get involved with pushing for acquisitions.

Kindred trades in Stockholm below the ticker “KIND.”

Capital Group Likes Kindred Stock

The most recent notification from the gaming company relating to Capital Group’s investment in the firm isn’t the first. In truth, the fund issuer appears to be rather bullish on the stock.

In January, Kindred notified investors that Capital Group’s position in the business elevated to 5.03 % from four.58 percent. That was followed by a July announcement that the fund giant’s stake in the gaming operator jumped to 5.15 %, meaning that over the course of 2021, Capital Group much more than doubled the quantity of Kindred shares it holds. The Kindred filings indicate it’s American Funds SmallCap Planet Fund (SMCWX) that holds the gaming equity.

That fund has $84.45 billion in assets under management and invests in domestic and foreign growth stocks with market values of up to $six billion at the time of inclusion, meaning SMCWX is home to primarily tiny caps and smaller mid-cap equities.

The strategy’s immense investment universe plays to its strengths. Its managers distill the 6,000-stock MSCI All Nation Globe Small Cap Index into a 700-800 stock portfolio by dividing and conquering. Under American Funds’ multimanager framework, this strategy’s 17 managers ply their preferred styles in their own sleeves, offered they target firms with marketplace caps among $500 million and $6 billion,” according to Morningstar.

The study firm has a “silver” rating on the fund. At the end of the second quarter, Kindred stock accounted for .21% of the fund’s weight. SMCWX holds other gaming equities, such as DraftKings (NASDAQ:DKNG) and Entain Plc (OTC:GMVHY).

Kindred Stock Bet Could Payoff for Capital Group

It remains to be observed if the Kindred takeover chatter gains momentum, but the firm has some exposure to the US, the quickest-expanding sports wagering industry in the globe.

The Unibet brand holds licenses in Arizona, Indiana, Iowa, New Jersey, Pennsylvania and Virginia, according to the Kindred website. Across sports wagering, iGaming, poker and bingo, Kindred believes the global markets for these segments whilst sports nine % compound annual growth by means of 2025.

“Kindred is the world’s fourth biggest on the internet gambling operator in terms of Gross winnings income and has practically 30 million registered customers across several countries. Our income is diversified, each from a solution and a geographical perspective, which gives a steady base and several development opportunities,” according to the organization.