- Caesars Entertainment has completed the $4 billion USD acquisition of William Hill.
- William Hill US CEO Joe Asher is stepping down and will not be part of the company going forward.
- Caesars will divest all non-US components of William Hill including UK and international online divisions and retail betting shops.
After a bit of unexpected complication at the end of the road Caesars Entertainment (NASDAQ: CZR) has completed their $4 billion USD acquisition of UK based sports betting company William Hill.
The press release announcing the completion of the deal was very succinct compared to most of the genre. Here’s how Caesars Entertainment announced the news:
Caesars Entertainment, Inc. today announced that it has completed its acquisition of William Hill PLC for approximately $4.0 billion. The transaction gives Caesars ownership of one of the world’s leading betting and gambling companies and gives the Company the ability to maximize the opportunity within sports betting and online gaming in the U.S.
That last sentence about ‘maximizing opportunity in the US’ is important but more about that in a moment. Tom Reeg, CEO of Caesars Entertainment, gave a quote in the press release that was also extremely clipped:
“We are thrilled to complete the acquisition of William Hill, combining two of the premier operations in the sports betting and iGaming industries under one roof. We look forward to announcing future sports partnerships that will drive long-term growth.”
The deal hit a significant snag when shareholders contested the ‘joint venture’ agreement advancing the argument that terms had not been properly disclosed. On April 20, a UK court ruled in favor of Caesars which eliminated the final obstacle to consummating the deal originally announced in September. More from the press release about the market footprint of the combined Caesars/William Hill sports betting and online gaming platforms:
The combined companies currently operate sports betting in 18 jurisdictions in the U.S., an industry-leading 13 of which offer mobile sports betting. The Company expects to be operational in 20 U.S. jurisdictions by the end of 2021.
The transaction further expands the reach of Caesars Rewards by providing William Hill members access to the Company’s industry-leading loyalty program, including the ability to earn tier status that can be used at all of the Company’s land-based and online properties. This combination also enables the Company to further enhance its services to customers by providing a single-wallet offering of sports betting and online gaming products across the enterprise in the future.
THE WILLIAM HILL BRAND WILL LIVE ON IN THE US
One question that has lingered throughout the process is the future of the William Hill marquee in the United States and elsewhere. A secondary question was whether or not a Caesars owned William Hill would continue managing sportsbooks for third parties. The initial answer to the both questions came in November when CEO Tom Reeg indicated in the company’s Q3 earnings call:
You should expect that we will use the Caesars brand for Caesars operated, owned and operated properties. And for third-party properties, you should expect that the William Hill brand will live on in the US.
Reeg’s comments were further validated with a flurry of activity related to the William Hill purchase at the March 2021 meeting of the Nevada Gaming Control Board. Amid agenda items concerning financial interest, licensing transfers, etc. were some items related to the perpetuation of the William Hill brand:
I’m still not convinced that Caesars wants to keep managing third party sportsbooks for the long term. It could be that untangling all of the existing William Hill management contracts was too much trouble/expense and the conclusion was reached that it was more expedient to fulfill them. On the other hand, Caesars could conclude that the management business is a good revenue stream.
SO WHAT HAPPENS NOW?
For now, probably ‘business as usual’ for the Caesars run sportsbooks as well as William Hill third party books. That being said, there are a couple of interesting items that we’ll be following in the immediate future. The first is the disposition of William Hill’s non-US assets. Caesars has planed to divest these assets all along and the company reiterated these plans in the press release announcing the completion of their William Hill purchase. This means that the William Hill retail betting shops in the UK as well as the UK and international online divisions will be up for sale. This will raise anew the question about the survival of the William Hill brand outside of the US. Caesars could choose to license the name to new owners though if an existing sports betting company bought the non-US assets they might want to rebrand. So far no information on potential suitors for any of the non-US assets though obviously Caesars wouldn’t say anything prior to the completion of their acquisition even if they have an ‘understanding in principle’ for some or all of the international assets.
Another interesting item was the resignation of William Hill US CEO Joe Asher pretty much before the ink was dry on the final deal. Here’s how CDC Gaming Reports described it:
A spokeswoman for Caesars confirmed that William Hill US CEO Joe Asher stepped down and will not be part of the combined company. Asher joined William Hill US in 2012 the company acquired Las Vegas-based Brandywine Bookmaking, a company Asher created. Asher launched Brandywine in 2008 which operated under the brand name Lucky’s Race & Sports Books.
As of yet, no context for Asher’s decision. Legal Sports Report confirmed the news via an email exchange with Asher who provided little information:
“This is true,” Asher told LSR in an email. “Future plans are to take a little time off and then pick some winners in Del Mar. After that, time will tell.”
Asher has been CEO of William Hill US since the beginning and has been in the gaming industry all his life. There’s very likely more to this story than Asher is letting on and I’ll make him resurfacing in a new position and/or with a new sports betting related project within the next year a -250 favorite. As of the time of this article’s writing, Asher was still on the William Hill US website:
A lot of opportunity out there right now and Asher is as sharp as they come. If he is spotted at Del Mar I’m guessing he’ll be spending as much time plotting his next move as on handicapping the ponies.
Next week we’ll do a deep dive into the history of William Hill and recap their entry into the Nevada market.
At the time of publication, James Murphy has a long position in CZR.