We look at Caesars' acquisition of William Hill:
How the market will look, reasons, similar mergers in the past and next candidates

The operation that will unite the paths of Caesars and William Hill will create a leading company in an sector, which after the events worldwide this year, was forced to witness movements of two types:


Obviously the case of Caesars and William Hill is going to become the paradigmatic example of the first case, something that Flutter and The Stars Group already did at the beginning of the year and that will serve to create a joint project that would see the two giants have a combined business of world-class gaming, online casino and sports betting on both channels and in all relevant regulated markets around the world.

The reasons for the operation

The risk rating agency Moody's already warned a few weeks ago: one of the likely consequences that the pandemic was going to leave is a new moment of turmoil in the gaming sector at the level of mergers and acquisitions.

We were waiting for a first great agreement that produces a wave of mergers and with the more than secure union between these two giants we already have it.


At a strategic level, the reasons behind the agreement would be:

• Caesars seeks to consolidate in the United States

After the enormous difficulties that Caesars has found in competing with operators that compete "you to you" in most North American state jurisdictions -such as Draftkings or Fan Duel-, the strategic alliances with various operators seem to have not served to convert the leading operator (eg deals with 888 at the online poker level in numerous states, including joint exploitation of the WSOP brand).

• The impossibility of William Hill to face the changes that are coming in the UK and markets

Although few operators seemed as prepared as William Hill to face alone the changes that are coming in the majority of regulated markets - starting with the United Kingdom - and with regard, for example, to the prohibition of advertising and all kinds of promotions or restrictions on the management of VIP players or in the design of games of chance, the truth is that the difficulties are enormous even for the leading companies. Even more so in the case of William Hill, who has parted company with his face-to-face business due to the new minimum wagering policy for FOBT machines.

• Excessive dependence on the sports betting segment

If the Covid-19 crisis has revealed something, it is that depending on a single product is not a good solution for the future and to guarantee a decent income statement. Joining forces between the different gaming segments and across the two channels guarantees that you can shine and lead an increasingly "multi-product" gaming market.

• The revaluation of the gaming market in the United States

Estimates of the size of the US gambling market have taken a significant leap at the valuation level by independent institutions. In fact, many financial media have echoed that the global gambling market in the country has already gone from 10 billion dollars to 40,000 at the annual income level.

The last five years of mergers in the sector

With the union between William Hill and Ceasars, the five-year period in which the mergers have completely changed the map of the sector and the positioning of the companies that during the past decade had been protagonists of the beginning of the era of online gaming closes.

• 2016 was the year in which Betfair merged with Paddy Power, the largest operation carried out in the United Kingdom and which would lead in 2019 to subsequent agreements that would lead to consolidate the current Flutter Entertainment as the main company in the sector. For its part, Ladbrokes merged with Gala Coral creating the Ladbrokes Coral brand ... At the same level as the agreement between Betafir and Paddy, also in 2016 Bwin Party joined the giant GVC.

William Hill has also taken advantage of this five years to acquire smaller companies and in 2016 he took over Grand Parade.

• In 2017 NYX was acquired by Scientific Games, while Mr Green took over Dansk Underholding Limited, making the Swedish operator one of William Hill's next targets.

• In 2018 and with the objective set in the emerging US market, FanDuel is bought by Paddy Power Betfair while Sky Bet joined The Stars Group and Ladbrokes Coral did the same with GVC.

This year William Hill also began to prioritize the United States and let his Asutralian division William Hill Australia be acquired by The Stars Group.

• In 2019, William Hill takes over CG Technology and MrGreen while globally the great merger deal of the year between The Stars Group and Flutter takes place.

888 Holdings next?

After years of rumors of a possible merger between the two Israeli-born giants of the London Stock Exchange, it seems that the union between William Hill and 888 is further away than ever. Curiously, it seems that William Hill will join the brand that had sounded the most as a possible partner of 888 .... In any case, it seems that investors trust that the operator of the three eights could be the next protagonist of a similar story.



On Wednesday, 888 shares were up about 20%. And it is that it is the perfect company by size, presence in regulated markets and product offer to be acquired by a global giant.

And is that with the pandamia, 888 has been one of the operators that has shown that it leads the multiproduct gaming offer. Not being dependent on sports, having its own poker software and being a leader in casino both in regulated markets and internationally make it the perfect partner to be able to negotiate with a relevant player and become "the next William Hill" on the stock market.

A William Hill, by the way, who by virtue of the merger with Caesars would disappear from the list of securities listed on the London Stock Exchange.