Svenska Spel, the Swedish state-owned gambling operator, made an announcement on Wednesday regarding the potential closure of two of its land-based venues, Casino Cosmopol in Gothenburg and Malmö.
The decision comes after the company previously implemented an action plan in an attempt to revitalize Casino Cosmopol. This plan involved a significant restructuring of the organization, a reduction in the number of employees, simplifying the concept of the restaurant, and reducing working hours and days. Despite these efforts, the share of online gambling continued to grow, leading to further negative development for Casino Cosmopol.
As a result, Svenska Spel confirmed its intention to close the two venues while seeking to “limit losses.” However, the closure of the casinos is subject to negotiations with the union. If operations in Gothenburg cease, approximately 120 employees would be affected, while the closure in Malmö may impact an additional 80 workers. If the casinos do close, the operator would be left with its largest venue, Casino Cosmopol in Stockholm, which is the last remaining brick-and-mortar casino in Sweden.
Svenska Spel attributed its decision to the decreasing share of the land-based sector within the gaming vertical in the country. The company noted that there was a major shift toward the online gambling sector in 2019 following the reregulation of the industry. Additionally, the pandemic further impacted its land-based operations.
Patrik Hofbauer, Svenska Spel’s president and CEO, acknowledged the trend of people shifting toward online gambling and explained that despite significant measures, challenges to reach profitability for Casino Cosmopol persisted. Ola Enquist, CEO at Casino Cosmopol, emphasized the efforts to reduce costs and increase revenue but stated that the measures were insufficient, leading to the tough decision to wind down two of the casinos.
The closure of the casinos will undoubtedly affect many of the operator’s employees, and the decision was described as emotionally tough by Ola Enquist. Despite the difficult decision, Svenska Spel expressed a commitment to adapt to the changing gambling landscape and minimize the impact on its employees.