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Caesars Entertainment Stakes £3 Billion on William Hill Buyout
By Shane Addinall Sep 29, 2020 IndustryWilliam Hill has massive recorded massive financial losses due to the month’s long lockdowns in the UK. However, they have received buyout offers which could soon see the UK’s biggest bookmaker owned and operated out of America.Saying that 2020 has been a year of unique challenges is a ridiculous understatement. Which is why it came as no surprise when retail front focused bookmaker William Hill announced it was considering buyout proposals from interested parties.
In an interesting twist none of the offers came from a European or UK based investor, rather both are offers come from businesses based in America. In our upside-down new-normal this means the UK’s biggest bookmaker could be owned and operated by either Apollo investments or Caesars Entertainment!
Hobbled by Foot Traffic
While William Hill does have an online casino and bookmaking brand the mainstay of the larger corporation is its more than 1500 UK outlets. However, with the UK facing a string of lockdowns there are real concerns over the viability of maintaining such a large foot traffic focused business in the short to medium term.
August 2020 saw the company close 119 High Street betting shops in a bid to begin repaying its furlough debt of more than £24 million, which is in addition to its net loss of £63 million for the previous financial year.
One Horse Race
While Apollo has penned an offer, the real money is on Caesars Entertainment to win the hand of William Hill at the end of the day. As it stands Caesars already owns a 20% stake in the William Hills USA chain of 170 betting sites, which allows them the exclusive rights to operate under the Caesars Entertainment brand.
In addition to the fact that the companies already share vested interests the offer from Caesars is reported to be an astounding £2.9 billion. Best of all William Hill investors will be able to cash out immediately as the offer is all cash, not split into shares or other value adds.
Caesars Entertainment CEO, Tom Reeg, said:
“The opportunity to combine our land-based casinos, sports betting and online gaming in the US is a truly exciting prospect. William Hill’s sports betting expertise will complement Caesars’ current offering, enabling the combined group to better serve our customers in the fast-growing US sports betting and online market.”
While the existing UK business is vital to the deal it is clear that Caesars is betting on the further expansion of gambling legislation in the USA. They claim that the acquisition could see them net an additional $700 million in 2021, cementing them as a leader in what analysts predict will one day be a $35 billion market annually.
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