William Hill Shares Jump Following US Casino Deal
British bookmaker William Hill has secured a partnership with American casino group Eldorado Resorts, leading to a 6% rise in its share price.
As the British gaming industry is facing tighter regulation, the landmark development liberalising the gambling sector in America drives British gambling operators to plough ahead with plans to expand to the United States.
William Hill believed that the partnership meant having access to “one of the largest and most attractive” casino chains, which welcome 23 million visitors across America. The deal will allow Eldorado Resorts to receive £39 million worth of shares from the British betting company, subject to a up-to-5-year lock-in period and a 20% stake in William Hill’s operations in the US.
Since the US began to liberalise its sports gambling industry earlier this year, the UK gambling operator is said to have the widest footprint of any sports betting firm in the 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.” said William Hill’s chief executive Philip Bowcock.
With assets worth a total of £53.4million, William Hill US has made underlying earnings of £22.2 million last year.
“William Hill’s new partnership with Eldorado Resorts makes perfect sense as a land-grab exercise. By linking with the casino group, it gets access to 13 states with a view to launching William Hill sportsbooks in a number of these states within weeks. Further down the line, it is in prime position to benefit as further states allow sports betting.” stated an analyst at investment platform AJ Bell.
“William Hill needs the US to be a success because its UK operations continue to face increased regulatory pressures. Its London-listed rival GVC also has similar aspirations over the pond having recently made a partnership with casino group MGM Resorts.”