Bally’s Corporation has agreed the key terms of the possible acquisition of UK online gambling operator Gamesys, the US casino operator announced Wednesday.
Under the terms of the deal, Bally’s would pay 1,850 pence per each Gamesys share in cash. That represents a 13% premium from the latter company’s closing price on Tuesday and values it at £2.02 billion (approx. $2.7 billion).
Bally’s approached Gamesys with an initial proposal in late January. The Rhode Island-headquartered casino firm said there is no guarantee that it will express a firm intention to bid for the UK company and that any formal offer will be subject to shareholder and regulatory approval.
It should be noted that Gamesys founders Noel Hayden, Andrew Dixon, and Robin Tombs as well as major investor HG Vora have indicated that they will back a tie-up.
If Bally’s decides to buy Gamesys, that will be the latest marriage between a US casino operator and a UK company with sports betting and online gambling experience. In a similar move, Caesars Entertainment, Inc. is set to close the acquisition of British bookmaker William Hill next month.
In addition, Caesars rival MGM Resorts International tabled an $11 billion offer for Entain earlier this year, but the latter rebuffed the bid, arguing that it significantly undervalued it.
Cracking the US Market
The purpose of all of the recent transatlantic dealmaking is for companies with land-based casino traditions to tap into the fast-growing US sports betting and online gaming space. Partnerships with operators with experience in providing digital gambling services could significantly facilitate their entry into that nascent but highly lucrative market.
Both iGaming and sports betting have exploded during the pandemic and have the chance to expand even further in the US where the Supreme Court authorized athletic gambling in 2018.
Gamesys creates online casino and bingo games and manages the Virgin Casino and Jackpotjoy online gaming brands. The company works with proprietary technology, which Bally’s will be able to benefit from, if it chooses to acquire it and if it is given the nod to do so.
Bally’s Chairman Soo Kim said Wednesday that “Gamesys’s proven technology platform alongside its highly respected and experienced management team, combined with the US market access that Bally’s provides, should allow the combined group to capitalize on the significant growth opportunities in the US sports betting and online markets.”
If the casino operator acquires the iGaming company, Gamesys CEO Lee Fenton will take the reins of the combined group.
The possible deal will be the latest in a string of acquisitions for Bally’s (formerly Twin River Worldwide Holdings) in recent months. Last year, the company bought casino properties in New Jersey, Nevada, Louisiana, and Illinois to expand its land-based presence.
It also purchased the Bally’s brand from Caesars. After changing its corporate name to Bally’s, the company is now set to rebrand its properties across the US to reflect its new identity.
In addition, it purchased sports betting platform Bet.Works in a $125 million deal in November and bought daily fantasy sports operator Monkey Knife Fight earlier this month, indicating interest in both the sports betting and DFS fields.
Source: Casino operator Bally’s agrees ‘key terms’ of £2bn Gamesys offer, The Financial Times, March 24, 2021