William Hill and Caesars Discussed a Multi-Billion Merger, But No Deal
If this deal had come through, the US gaming corporation would have taken over the British bookmaker, creating a strong business entity, with an excellent position in the sports betting market in the United States.
According to available information, the two sides were discussing a cash-and-shares deal, but the negotiations eventually fell through.
William Hill Consolidating
Following the US Supreme Court’s decision to end the federal ban on sports betting last May, a number of states have made this activity legal. With wagering on sports becoming more and more popular, it’s easy to see why the British bookmaker has ambitious expansion plans in this market.
Back home, William Hill, as well as other UK operators, are experiencing heavy regulatory pressure, including the crackdown on fixed-odds betting terminals (FOBTs). Earlier this year, the UK government cut the maximum stake on the gaming machine by 50 times, which will certainly reflect on the profitability of operators. Many experts believe we can expect betting shop closures in the near future, as well as job losses.
News of these merger talks will likely once again spark speculations over the future of the British bookmaking giant. The company’s rivals are already in the process of market consolidation, signing multi-million dollars agreements, and doing everything to offset the losses from the crackdown of FOBTs.
William Hill did have talks with a couple of potential buyers over the past few years. Back in 2016, the renowned bookmaker turned down a bid made by 888 Holdings and The Rank Group, while only a few months later it rejected a proposal from the Canadian giant The Stars Group. Both these deal didn’t go through due to pressure from the company’s largest shareholders.
In the meantime, William Hill carries on with its own plans. In February, the bookmaker completed the purchase of Mr. Green in a deal seen as a mean to improve the company’s digital performance.
The deal has secured a ready-made base within the EU once the UK leaves the European Union, as the company is based in Gibraltar, and Mr. Green is headquartered in Malta.
According to available information, William Hill’s Chief Executive Officer, Philip Bowcock expressed his desire to sell the business, as there were pretty big targets set for what the company planned to do in the US.
Similar Situation for Caesars
When it comes to Caesars, the situation is similar. The company’s largest shareholder, Carl Icahn, has said on numerous occasions that the best move would be to sell or merge the gaming giant with another business.
Last year, Caesars rejected an offer from Tilman Fertitta to merge with Golden Nugget, while news emerged earlier this year that the company was discussing a merger with Eldorado Resorts.
However, it was revealed that Eldorado’s Chief Executive Officer, Tom Reeg, wanted to cut Caesars’ costs by a minimum of $500 million before talks proceed further.
At this moment, Caesars operates 53 gaming and non-gaming resorts on four continents.