“Tall and tan and young and lovely, the girl from [Brazilian iGaming] goes walking and when she passes I smile but she doesn’t see. She just doesn’t see.
“[But] I watch her so sadly. How can I tell her? Yes, I would give my heart gladly. But each day, when she walks to the sea, she looks straight ahead. Not at me.”
Forgive the paraphrasing, these celebrated lyrics from the wonderful Bossa Nova, Garota de Ipanema, The Girl from Ipanema, could just as well apply to Brazil’s surging sports betting market.
Despite the hype and the fanfare, only one major M&A deal has been struck — when Flutter bought a controlling stake in BetNacional owners NSX Group in September.
According to industry players at ICE 2025 in Barcelona consulted by iGamingFuturo, Flutter invested US$700 million (£562.94) for what will eventually become Flutter Brazil once licensing has been fully granted.
Attractive
So why hasn’t the attractive Brazilian market, said to be the fifth in the world already, not drawn more investment?
Brazil’s iGaming industry, which was fully regulated only recently, starting on January 1 this year, is still on a learning curve and investors are waiting to see what the market dynamics will be before diving in, our experts tell us.
The regulation process should separate the wheat from the chaff among the thousands of platforms that sprung up offering bets to Brazilians, and then the consolidation phase will begin later this year, they foresee,
The M&A market in Brazil, focusing on the sports betting and online gaming sector, has not yet taken off yet because companies could not change their corporate control before the first authorizations were granted, which only occurred at the end of December 2024, according to Fabio Kujawski, a Partner at Mattos Filho law firm in Sao Paulo.
“From now on, with licensed companies, we expect a significant increase in the number of transactions involving the sector,” Kujawski told iGamingFuturo.
“Most of the license applications [around 300] were made by companies belonging to foreign groups.
Arrogance
“This reveals a very clear interest from international investors, in whose home markets they have been operating for many years and are already stabilized, such as the United States and Europe,” said Kujawski.
The opportunity for significant revenue growth tends to be achieved through the liberalization of iGaming in jurisdictions that previously did not allow the exploitation of this activity, he added.
“In this scenario, Brazil is the ideal country, given the size of the local market,” he said.
An important factor holding back investment is the lack of visibility on the dynamics and prices of this new market, according to André Gelfi, General Manager of Betsson Brazil and head of the Brazilian Institute of Responsible Gaming (IBJR).
“With the market now regulated we should be assessing data by the end of the month on what the dynamics are going to look like, but making investment decisions with such limited visibility is difficult,” he said.
“On the sell side in Brazil, there is too much optimism and arrogance, I would say, regarding valuations.”
Consolidation
Gelfi expects a consolidation process to begin that will reduce the number of licenses granted, 66 so far, which is considered excessive for a market this size, and then we will see an industry operated by “the usual suspects”, or bigger international players.
“Acquisitions will materialize once we have better visibility of what is going on in this market. It is all very new and hard to get the prices and harder to realize deals at present,” he added.
Gelfi said Brazil’s regulator, the Finance Ministry’s Secretary of Prizes and Betting, is trying to tackle the myriad of betting platforms that surged before regulation was enacted.
Blocking
The government, for example, has blocked 9,000 illegal betting sites since October.
“They are managing to block what they can identify, but unfortunately this is very dynamic; you close down 1,000 and the next day you have another 1,000 brand new ones available to Brazil,” he noted.
And Gelfi is skeptical about Brazil’s capacity to tackle the illegal market by blocking websites.
Perhaps a more effective way will be to “strangle” illegal operators by making it harder on the payments side, said Gelfi, because Brazil expressly bans financial institutions from processing electronic payments (PIX) from unauthorized companies.
Until then suitors, suitable or otherwise, will continue to pursue the beauty that is Brazilian sports betting.
