- William Hill and Caesars Entertainment are in discussions for a possible new business venture that would combine sports betting and iGaming into its own platform.
- A deal between the two companies could lead to a value of $7 billion as one entity if they were to go through with it.
LAS VEGAS – Coming off the purchase of CG Technology (a sports wagering firm with Cantor Fitzgerald LP), U.K. based sports betting business William Hill Plc is looking toward making a deal with Caesars Entertainment Inc. to combine each companies’ strengths into one.
Sports wagering would be the part of William Hill’s contribution while the iGaming part would come from Caesars' platforms.
If the two were to come together as one entity, estimates show they could bring in as much as $700 million in annual revenue from the industry which is one reason that these discussions are taking place.
Sports Betting And iGaming In One
Caesars owns 20% of William Hill’s US operations through their El Dorado Resorts Inc. acquisition in July. The two companies joining forces could prove to be a lucrative venture as far as becoming a more profitable competitor in the sports betting market.
One of the top businesses in the online sports betting industry, DraftKings, has a worth of over $12 billion, being the company to beat.
On their own, the money they bring in makes them a less than formidable opponent in the gambling market than if they were to go into business together, especially when they’re up against powerhouses like DraftKings.
“William Hill is our partner solely on sports betting,” said Tom Reeg, CEO of Caesars. “You’d be gathering all our mobile assets, both sports and online. That would be ideal.”
Wolfe Research analyst Jared Shojaian studied the potential behind a merger of William Hill and Caesars internet operations, revealing that it could be worth $7 billion when all is said and done.
That’s only $5 billion behind DraftKings which is a huge selling point to put this deal into action. There are a number of options between what could occur, from Caesars buying out William Hill altogether to a joint operation between the two.
Shojaian believes that a joint venture that creates its own entity with 20% going to the public investing in them will keep the value of the business high.
“There’s a lot of opportunity in there, and we think that we’ve got some really powerful assets in this space, so obviously it’s an ongoing subject of discussion,” said Joe Asher, U.S. chief executive officer for William Hill.
William Hill now has 170 sportsbooks in 13 states in the nation because of their El Dorado (Caesars) deal which has expanded their footprint in the United States exponentially. A combination of Caesars iGaming assets could create one of the largest USA online gambling platforms.