It’s official: Caesars has agreed to buy William Hill for $3.7 billion.
William Hill is one of five online sportsbooks in Illinois. It earned market access through the Grand Victoria Casino in Elgin, a Caesars property.
Here’s what we know about the deal and how it will change sports betting in Illinois.
All in on online gaming
Caesars, one of the largest gaming companies in the country, wanted to expand its portfolio.
It looks to have done so with this deal.
“The opportunity to combine our land-based casinos, sports betting and online gaming in the US is a truly exciting prospect,” said Caesars Entertainment CEO Tom Reeg in a press release.
The deal should close in the second half of 2021. Caesars already held a 20% stake in William Hill before the acquisition, hence William Hill’s affiliation with Grand Victoria.
Caesars has been aggressively seeking media partnerships, and the deal would expand its access on that front as well. It has a multi-year relationship with ESPN, while William Hill is partnered with CBS Sports.
Caesars believes its new sports and online gaming business could generate between $600 million–$700 million in net revenue in the US in 2021.
Roger Devlin, chairman of William Hill, said:
“The William Hill board believes this is the best option for William Hill at an attractive price for shareholders. It recognizes the significant progress the William Hill group has made over the last 18 months, as well as the risk and significant investment required to maximize the US opportunity given intense competition in the US and the potential for regulatory disruption in the UK and Europe.”
And while we don’t know for sure, it’s quite possible that William Hill online sportsbooks are rebranded to Caesars, given the latter’s strong brand recognition.
While William Hill is live in Illinois, you don’t see much (if any) marketing for it compared to the other sportsbooks.
Perhaps it was waiting for this deal to finalize before making any substantial marketing push.
William Hill was probably the least interesting of IL’s five online sportsbooks as of last week, but there’s certainly reason for intrigue now.
Caesars to sell off non-US businesses
The press release indicated that the entertainment company would look to sell off William Hill’s non-US assets.
“In terms of our UK and International businesses, we believe they have a strong future ahead and we will work with Caesars to find suitable partners to further the long-term growth prospects of these businesses,” it reads.
Those assets accounted for 93% of group revenues in the first half of 2020.
That includes William Hill UK online, the UK retail estate, and the international part of the business. In 2019, they combined for about $575 million in revenue.
Other benefits for Caesars
It’s been a busy year for Caesars, and the William Hill acquisition is just the latest example.
In July, it completed its merger with Eldorado. Eldorado purchased the Grand Victoria Casino in 2018, which is why it’s now a Caesars property.
But Caesars also owns Harrah’s Joliet and Harrah’s Metropolis in Illinois. Neither casino has a retail sportsbook at the moment, but if they choose to pursue licensing, William Hill is now fully on board.
Zooming out, Caesars also has a highly regarded loyalty program that contains around 60 million members.
Having a unified wallet and customer experience across online sportsbook and online casino is another attractive part of the deal.
Following the news, Caesars’ share price was up 3% in pre-market trading.