American hotel and casino operator Caesars Entertainment is reportedly in late-stage acquisition talks with British sports betting company William Hill. According to analysts' a deal could value the bookmaker at around $3.7 billion.
The planned acquisition underscores Caesars Entertainment's plan to capitalize on the growing online gaming and sports betting markets in the U.S. In a joint statement Monday, the two companies said Caesars Entertainment had agreed to pay a significant premium to acquire William Hill.
Caesars Entertainment said it could pay up to $3.45 for each of William Hill's shares. This represents an 81% premium to William Hill's average share price over the past three months. Under the deal, Caesars Entertainment would take full control of William Hill's U.S. joint venture. William Hill currently controls about 32% of Las Vegas' sports betting and has large market shares in other parts of the country adopting the recently legalized form of gambling.
William Hill's share price in London had risen as much as 41% when it announced that it had received offers from both Caesars Entertainment and private equity company Apollo. The stock eventually pulled back Monday - dropping by around 11%.
"The opportunity to combine our land-based-casinos, sports betting and online gaming in the U.S. is a truly exciting prospect. William Hill's sports betting expertise will complement Caesars' current offering, enabling the combined group to better serve customers in the fast-growing U.S. sports betting and online market," Caesars Entertainment chief executive officer Tom Reeg said.
William Hill's share in the U.S. sports betting market has been steadily increasing outside Las Vegas since the U.S. Supreme Court legalized outside of Nevada in 2018. However, the steady growth was put on hold after the pandemic hit earlier in the year. The company's business declined a little after the pandemic disrupted sports events during the first half of the year.
As sports eventually returned William Hill saw an increase in demand for online gambling. Data published by the American Gaming Association forecast about 35 million Americans would likely bet on this NFL season.
