888 Confirm Buyout of William Hill’s Non-US Business

Business HandshakeIn September of 2020, it was announced that Caesars Entertainment had agreed a deal to buy William Hill for $3.7 billion. The move was made in order to allow Caesars to move into the ever-expanding US sports-betting market, with the company only caring about the side of the William Hill business that operated in the United States of America, meaning there was plenty for other companies to feast on.

It now seems as though that feasting has begun, with 888 Holdings Plc announcing that they had reached an agreement to buy the ‘non-US’ business part of William Hill International from Caesars. The deal is worth an estimated £2.2 billion, with the aim being to allow 888 to build a ‘global online betting and gaming leader’. It also allows 888 to make the move into high street shops, with 1,400 of them being part of the deal.

888 Moves To Become A Big Player

888sport LogoWilliam Hill was one of the United Kingdom’s biggest bookmakers when it was bought by Caesars Entertainment for around $3.7 billion. At the time, Caesars made clear that it wasn’t interested in William Hill’s wider brand, instead being focussed on what owning the company would mean for their moves into the ever-growing market in the United States of America.

By agreeing to pay £2.2 billion for the William Hill business outside of its US operation, 888 Holdings have created something of a win-win for all parties. On the one hand, Caesars Entertainment have recouped a huge chunk of the money that they spend buying the brand in the first place, whilst 888 can start to position itself as one of the biggest betting brands in the market.

888 expects to complete the deal at the start of 2022, provided the company’s shareholders agree the move. It is unlikely that they won’t, though, considering what it will allow the company to do moving forward. Founded by Israeli tech entrepreneurs, it has previously specialised in the online casino world but can now look to make a move to establish itself on Britain’s high streets.

According to Russ Mould, the Investment Director of AJ Bell, the move will see 888’s sales shift from around $814 million to $2.5 billion. At the same time, the larger company’s underlying earnings will move from the $156 million mark to closer to $464 million. It will also allow the business to rub shoulders with other large merger-based gambling businesses such as Flutter Entertainment and Entain.

888 Will Keep The Shops

Open Door Sign in Blue

As soon as the move by 888 Holdings to buy William Hill from Caesars Entertainment became known, interested parties began to circle with the belief that they would be able to buy the 1,400 or so William Hill shops from the online betting company. 888 decided to resist such overtures, however, and has confirmed that it intends to take advantage of the real estate it will soon own.

Chief Executive of 888 Holdings, Itai Pazner, said, “We did see interest in the retail [estate] from the outside but we feel that the retail is an integral part of the William Hill asset.” William Hill boasted 2,333 stores in 2018, but a combination of the reduction in stakes on Fixed Odds Betting Terminals and the effects of the global health crisis means that is now closer to 1,400.

Pazner said, “Today they’re managing a very well-run retail estate that’s present in good and prime locations. We’re planning to keep the retail stores and the great people they have in them.” It means that rival firms such as Betfred will be disappointed, having hoped that they would be able to buy the shops and double their UK network as a result, which 888 will doubtless be pleased about.

888 Holdings Won The Auction

Auction Gavel Sold Sign

William Hill made a bid to buy 888 Holdings back in 2015, offering £700 million for then burgeoning online company. In 2016, 888 teamed up with Rank, the bingo hall owning company, in an attempt to form a three-way merger with William Hill. The company will now feel as though it has won the war with the well-known British bookmaker, having outbid rivals to take ownership of it from Caesars Entertainment.

When the US-based gambling business let it be known that the British and European assets of William Hill would be going up to sale, Germany’s biggest betting firm, Tipico, became a frontrunner to buy it. They weren’t the only gambling company interested in William Hill, of course, with the likes of Betfred, Apollo Global, Entain, Advent PE, BoyleSports and Kindred Group also rumoured to be in the chase.

On the ninth of September 2021, however, a news release was posted to the corporate news section of William Hill’s website, confirming that it was 888 Holdings that would be the eventual owner of the non-US side of the business. It will be big business, with the announcement suggesting that the combination of 888 and William Hill could be expected to bring in about £100 million per year.

Sports Betting Could Prove Important

Sports Equipment on Grass

There are concerns from many within the betting industry that the upcoming government review of gambling legislation will result in a crackdown that will leave companies extremely vulnerable. It is believed that online casinos will be a target of the reform, including the possibility that the same £2 maximum stake that was imposed on FOBTs will be put in place on online slot games.

Pazner is of the belief that, rather than causing a problem from 888 Holdings, the purchase of William Hill could help to protect the larger business from the slings and arrows of outrageous fortune. Indeed, he thinks it makes even more sense to push through the deal, given that William Hill’s sports-focused business could help offset the risk that comes with the uncertainty created by the government’s upcoming review.