Caesars already owned 20% of William Hill’s U.S.
W
illiam Hill has received rival takeover proposals from buyout firm Apollo Global Management and Caesars Entertainment, the British betting firm said on Friday, without disclosing the value of the offers. Shares of Caesars Entertainment rose nearly 7% on the news, while Apollo’s stock was up almost 3%.
William Hill shares rose more than 40% Friday, valuing the company at over £3 billion, equivalent to $3.82 billion. Under U.K. takeover rules, Caesars and Apollo now have until Oct. 23 to either make an offer for William Hill or walk away.
U.S. commercial slot-machine revenue this year through the end of July was $9.24 billion, down nearly 45% compared with the same time last year, while casino revenue from table games fell 46% to $2.6 billion, according to the AGA. Meanwhile, sports-betting revenue was up nearly 19% at $394 million, with more states having legalized the industry. Online casino revenue nearly tripled for the period, to $778 million.
William Hill has been hit hard this year by the coronavirus pandemic, prompting it to permanently close more than 100 of its U.K.-based stores. However, one big growth area for the company in recent years has been the U.S., where it has sought to tap the burgeoning sports-betting market. William Hill US accounted for 7% of group revenue in the first six months of the year.
The U.S. online casino and sports-betting market is expected to grow to $18 billion in revenue by 2025, with the top three players in market share projected to be Flutter Entertainment at 28%, DraftKings at 20% and Caesars at 12%, according to a Macquarie Research. Flutter Entertainment has the betting brands FoxBet and FanDuel.
Caesars already owned 20% of William Hill’s U.S. arm under in a deal signed two years ago with Eldorado Resorts, which merged with Caesars in July.
Caesars’ takeover of Eldorado extended that deal to iconic properties like Caesars Palace. About 15 additional locations should be added in coming weeks, including the Horseshoe in Council Bluffs, Iowa, and the Harrah’s in Atlantic City.
They would bring William Hill’s total to 170 retail locations in 13 states, the company said.
