On Wednesday, Caesar’s Entertainment acquired William Hill for $3.7 billion in a buy-out that would allow the U.K. sports betting operator to run all of Caesar’s sports betting locations.
“The opportunity to combine our land-based casinos, sports betting and online gaming in the U.S. is a truly exciting prospect,” Caesars CEO Tom Reeg said in a statement. “William Hill’s sports betting expertise will complement Caesars’ current offering, enabling the combined group to better serve our customers in the fast-growing U.S. sports betting and online market.”
William Hill and Caesar’s already have a joint partnership to operate sportsbooks, some sportsbooks in Las Vegas and Atlantic City. Now, the partnership will help expand the two entities.
William Hill and Caesar’s
The partnership helps both parties out. William Hill will be able to expand its customer base through Caesar’s customers, and Caesar’s will be able to expand operations into the sports betting industry. Caesar’s believes the sports betting industry will be roughly $30 billion to $35 billion.
The partnership will only help expand both entities. Caesar’s just recently finished an acquisition with Eldorado Resorts, and now William Hill can be added to the family.
What also helps the partnership is the media deals that both companies signed. Caesar’s is partnered with ESPN, and William Hill is with CBS Sports. Both will be able to capitalize on the viewership they will receive from sports fans. Caesar’s and William Hill will have their odds shown during programming about sports betting, which will only make them more attractive.
With William Hill acquired, Caesar’s believes they can create $600-$700 in net revenue.
What Does this Mean for William Hill
William Hill was in a tough decision from either accepting the Apollo Global Management and Caesar’s Entertainment. AGM reached out to acquire William Hill first as the investment firm was looking to get into the sports betting industry.
However, the joint venture between Caesar’s and the U.K. sports betting operator would have been in jeopardy. William Hill is already running some of Caesar’s sportsbooks at locations across the U.S.
If they went with AGM, then that would have been terminated.
“The William Hill Board believes this is the best option for William Hill at an attractive price for shareholders,” said Roger Devlin, Chairman of William Hill, commenting on the Acquisition. “It recognizes the significant progress the William Hill Group has made over the last 18 months, as well as the risk and significant investment required to maximize the U.S. opportunity given the intense competition in the U.S. and the potential for regulatory disruption in the U.K. and Europe.”
William Hill was smart to look at this in the long-term view. They already have a business relationship with Caesar’s and will only grow over the coming years. Not only are they already operating a majority of Caesar’s sportsbooks across the U.S., but they are also going to continue to expand as more states legalize sports betting.
William Hill understands how important it is to capitalize on the emerging U.S. sports betting market. Caesar’s will help them expand into states that have legalized sports betting and entering states that will legalize sports betting.