William Hill announced today that it has reached an agreement to sell a 20% stake in its US business to Nevada-based gaming operator Eldorado Resorts and to become the latter company’s exclusive sports betting operator.
The deal will provide William Hill US with the opportunity to distribute its sports betting offering across Eldorado’s 21 properties in 11 US states. The Nevada-based gambling operator’s pending deal for the acquisition of Tropicana Entertainment will further extend its and its new partner’s presence across 26 casinos in 13 states. The acquisition deal is expected to be completed in the fourth quarter of the year.
The announcement about William Hill US and Eldorado joining forces comes as multiple US states are looking to legalize sports betting following the US Supreme Court’s ruling from May 14 that struck down a federal ban on wagering on professional and amateur sports. Four states have already launched sports betting following the SCOTUS move and at least ten more are expected to follow suit in the near future.
Commenting on the newly formed partnership between William Hill US and Eldorado, William Hill CEO Philip Bowcock said:
Partnering with Eldorado gives William Hill access to one of the largest and most attractive casino footprints with 23 million customers across multiple states. This partnership provides extensive cross sell and profit growth opportunities to both parties. Together, we are positioned to capture the evolving US opportunity – starting with land-based sports betting and extending to digital sports betting and, in some states, online gaming.
William Hill has been operating in Nevada, the only state where sports betting remained legal after the enforcement of the federal ban on wagering in 1992, for the past six years. The company said recently that it holds a 31% share of the Nevada betting market.
Terms of the Newly Penned Deal
Under the terms of the deal, William Hill US will become the exclusive sports betting partner for Eldorado. The betting operator will operate physical sports betting facilities across the gaming company’s properties and will run an online operation, as well.
The deal will also see Eldorado acquire a 20% stake in William Hill’s US business. The Nevada-based gaming company will additionally receive $50 million of stock in William Hill PLC, subject to a 3- to 5-year lock up.
William Hill US will retain 80% of the newly enhanced business. The agreement also includes an option for the launch of an online casino. The deal has an initial term of 25 years.
Aside from Nevada, William Hill US currently operates sportsbooks at Monmouth Park Racetrack and Ocean Resort Casino in New Jersey, has agreed to provide sports betting services to 13 casinos in Mississippi, and began accepting bets in West Virginia on August 30. Parent company William Hill said today that it expects it to launch a sportsbook in Pennsylvania in the coming weeks.
According to media reports, Eldorado has not been the only US gaming company William Hill has been in talks with over the formation of a joint venture since the liberalization of the US sports betting market earlier this year. It is believed the British bookmaker has discussed the possibility with Penn National Gaming, but discussions were terminated at a very early stage.
William Hill is looking to extend its US footprint as much as possible at a time when its domestic business is underperforming and a looming crackdown on the controversial fixed-odds betting terminals is threatening the company’s domestic retail business which has been producing the largest portion of its revenue for years now.
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