888 Holdings PLC, commonly known as 888.com has recently announced plans to purchase William Hill’s non-US assets from Caesars Entertainment for a whopping £2.2 billion to “create one of the world’s leading online betting and gaming groups”, according to 888 CEO, Itai Panzer.
William Hill Limited is a global online gambling company founded in 1934 and based in London. The company had previously listed on the London Stock Exchange before Caesars Entertainment purchased the firm for £2.9bn in April 2021.
Last year, William Hill’s international revenue totaled around £1.12bn, with £803 million acquired through online operations and £354 million from retail. The company’s adjusted earnings before interest, tax, and depreciation was £157m.
The integration of online casino gaming and sports betting seems to be a prominent move of late, as similar deals between sportsbook operators and online casinos have emerged such as the recent purchase of Golden Nugget Gaming by the US sports betting powerhouse Draftkings.
The new deal between 888 and Caesars includes William Hill’s 1,400 UK betting shops with online operations across the United Kingdom and Europe and was introduced by Caesars after the industry giant secured the company earlier this year.
Caesars had made it clear that only the firm’s US-based operations were of interest when making the purchase and that the intention was to auction off unwanted areas of the business once the deal had been finalized.
CEO of Caesars, Tom Reeg said “We have found an owner for the William Hill business outside the U.S. which shares the same objectives, approaches and longer-term ambitions of that business.”
This will be 888’s largest acquisition since the company was listed on the London Stock Exchange in 2005, and will also give 888 Holdings access to William Hill’s 2 million active customer base in the UK.
888 Said that purchasing William Hill Limited would give it “significantly enhanced exposure to sports betting, the world’s largest and fastest-growing online segment, with the addition of an iconic sports brand” and that William Hill’s street shops were an important part of the deal.
Panzer commented on the deal by saying:
William Hill is an iconic sports brand, making it the ideal complement to 888, one of the leading global online gaming brands. Our strategies are also complementary, being digitally-led, customer-focused, and committed to player protection and raising industry standards around safer gambling.”
888 Has obtained approximately £2.1bn in debt financing from JP Morgan, Morgan Stanley and Mediobanca to fund the deal and also acquired a revolving credit facility of £150m.
The deal is classified as a reverse takeover, meaning that it has to be approved by a majority of 888 shareholders. The company said that investors holding 47% of 888’s shares have already approved the deal. However, 888 and Caesars must also gain backing from the UK Financial Conduct Authority and receive relevant gaming-related approvals as well as antitrust approval before the deal can be finalized.
888, with a total market value of approximately £1.5 bn, expects to see cost savings of around £10 million next year, and up to £100 million per year by 2025 if the deal follows through, which the company hopes to complete by mid-2022.