After Caesar’s Entertainment (NasDAQ:CZR) with its recent acquisition of the largest company based on the number of real estate properties among domestic game companies, it is known that another merger is already being discussed. This time, the company wants to link its online casino and sports betting business to the U.S. business of William Hill.
Analyst Jared Shojaian of Wolfe Research suggested that Caesars and William Hill would establish a 50/50 joint venture in the iGaming and Sports betting sector, each holding 40% of the companies and selling the remaining 20% to public investors.
In an interview with Bloomberg, William Hill’s CEO, Joe Asher, confirmed that his company was discussing marriage with Caesars to Internet casinos and sports gambling companies, but he revealed some details.
There are many possibilities, and since we believe that we have a really powerful asset in this area, this is, of course, the subject of ongoing discussions,” Asher explained in his communication.
Under a two-year contract with the then-British company El Dorado Resort, the British bookkeeper operates the sports book of the company, in which a casino giant accounts for 40% of the economy and 20% of William Hill’s U.S. savings.
Eldorado has only a few weeks left to complete the $17.3 billion takeover of Caesars, where the buyer was named after the target. Last week, William Hill completed the purchase of the CGT Nevada Business Unit.
With the acquisition, the operator of sportsbooks has significantly strengthened his presence in the New Town by adding books to the prestigious Las Vegas concert halls such as Cosmopolitan, Palms, Tropicana and Venice. By buying Caesars in El Dorado, William Hill had access to the famous Caesar’s Palace Sports Book.
With Caesar’s acquisition, William Hill also developed his former position in Las Vegas, where he is in charge of Caesar’s Area Real Estate and Sportsbooks in Atlantic City, New Jersey. According to Bloomberg, the U.S. portfolio reaches 170 volumes in 13 states.
The new version of Flamingo and Harrah operators has casinos in eight states where sports betting is legal, and in some states, including Louisiana, you can already participate in legal fights at the end of the year.
Last month, Tom League, CEO of Caesars, said that “permanent solutions” for the eye gaming and sports betting business could be unveiled by the end of the year.
Combining this time frame with the expectation that next year it could generate $600 million to $700 million in revenue, it’s easy to see why the conversation with William Hill is gaining momentum. Caesar’s Internet Casino/Sports Betting Division and William Hill’s U.S. operations share at least two important features. The path to great growth and the lack of awareness of the investment community from the perspective of some analysts.
The marriage of two companies and the sale of shares in the public can be the ideal method of generating shareholder value in units that can be used by the public.
At a time when the ratings of online gambling and sports betting companies accelerate to the highest level, it’s ideal for the value of free-trade Shojaian, the Wolf Research Analyst, says, Caesar’s combination with William Hill, based on the above forecasts of $600 million to $700 million online games/sports betting in 2021, will be worth about $7 billion.