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Bally’s Corp and Caesars Ent Venture into DFS in New Strategic Deals
By Jeff Osienya Feb 01, 2021 IndustryBally’s announces its Monkey Knife Fight acquisition plan and Caesars partners with SuperDraft pending a potential buyout in the future as the two casino and sports betting juggernauts zero in on the rapidly growing DFS market.Bally’s Corporation and Caesars Entertainment Inc, two of the most prominent casino operators in the USA have moved to forge new high stakes partnerships to secure their positions in the burgeoning fantasy sports industry in the country.
The two companies announced their fantasy sports ventures on the same day towards the end of January as part of their expansion strategies and a means to achieve higher levels of engagement with professional sports audiences.
Bally’s Corp + Monkey Knife Fight
Rhode Island-based Bally’s was the first to announce its plans to acquire Monkey Knife Fight (MKF), the third-largest operator of daily fantasy sports in North America, behind FanDuel and Nasdaq-listed DraftKings. Bally’s entered into a definitive agreement to acquire the award-winning DFS platform in an all-stock transaction estimated to be worth $90 million.
In the said transaction, MKF will first receive exercisable warrants that will allow them to buy about $50 million worth of Bally’s stock right away and the right to purchase $40 million more of Bally’s stock by 2023.
MKF is a San-Jose based company founded in 2018, and it offers a rich selection of DFS and e-sports contests to over 180,000 registered users spread across 37 US states, Washington DC and Canada. SponsorUnited, a respected analytics company recently ranked MKF as number ten in its list of the fastest-growing sports and entertainment brands in the world, and position six in the most-searched platforms under the same sports and entertainment category.
The deal is expected to be sealed in Q1 2021 and it will effectively make Bally the third sports betting company in the United States to offer fantasy sports services alongside a fully-fledged sportsbook. Of course, DraftKings and FanDuel are the only other brands that offer the DFS-sports betting combination.
After the Bally’s Corporation announcement, George Papanier, the company’s President and Chief Executive Officer expressed his pleasure in the prospects of leveraging MKF’s robust DFS offering to strengthen Bally’s position in the larger gaming world. His statement read in part;
Quote"With this acquisition, we are pleased to enter into the high-growth DFS market. Monkey Knife Fight is a unique asset that we look forward to incorporating into Bally's constantly growing omnichannel portfolio of land-based casinos and iGaming platforms. As with all of the properties and services that fall under the iconic Bally's brand, we are committed to providing a best-in-class DFS platform to sports fans around the country."
Caesars Entertainment Inc + SuperDraft Inc
After Bally’s disclosed its plans, Caesars also came forward a couple of hours later to announce that it had entered into a strategic investment plan with SuperDraft Inc but did not go into a lot of specifics. Through this arrangement, Caesars will become a minority shareholder of SuperDraft and it has an option to buy-out SuperDraft in its entirety over time in pre-discussed chunks.
SuperDraft is a New Hampshire-based DFS operator founded in 2019 by Steve Wang and it is hailed for its exceptional gaming models and interactive features that are enjoyed by both casual and hardcore fans of professional sports. Rather than offering the traditional salary cap popular with most DFS platforms, SuperDraft introduced a multiplier system that racks up player strength such that they are all projected to collect the same number of points.
The mechanic successfully injects a lot more flexibility into the roster, compared to what is offered elsewhere. And thanks to this refreshing approach, the DFS steamroller has a presence in 37 US states and Canada and it has a strong user base of over 80,000 registered users.
Tom Reeg, CEO of Caesars Entertainment, Inc. voiced this approval of the newly penned arrangement in a statement as follows.
Quote"The addition of daily fantasy sports fits seamlessly with our strategic vision for mobile and online sports. SuperDraft's innovative multiplier game mode is unique in the marketplace, and we believe it offers a tremendous opportunity to strengthen our position in the sports gaming landscape."
Per the arrangement, Caesars Entertainment Inc. will take in SuperDraft as part of its full slate of online and mobile gaming portfolio alongside Caesars Online Casino, World Series of Poker, and William Hill, which will join the lineup after its acquisition is completed.
Additionally, SuperDraft will also be used as a single wallet solution for Caesars’ patrons to offer them more choice for online and in-person gaming. The platform is also likely going to be integrated into the celebrated Caesars Rewards Program which offers players tons of perks through redeemable credits that are accrued online and in partner brick-and-mortar gaming houses.
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