888 will pay 2.2 billion pounds ($3 billion) to Caesars for William Hill’s international company, establishing a presence on Britain’s main streets with 1,400 betting shops.
The deal, which is 888’s largest since its London debut nearly two decades ago, would also give the company access to William Hill’s 2 million active UK clients at a time when government restrictions have prompted record online gambling volumes.
Until now, 888 had only operated online, whereas William Hill’s stores had long been a fixture on British streets.
Itai Pazner, the CEO of 888, dismissed reports that the company was considering selling its retail locations in order to focus on its internet business.
“Our intention is to keep the shops open. The stores are well-run, profitable, and have undergone a significant shift in recent years “On Thursday, Pazner told reporters.
Caesars’ 2.9 billion pound acquisition of William Hill in April was part of a larger trend in which numerous American companies bought London-listed firms to obtain experience as the US legalizes sports betting.
Caesars has made it clear that it did not want to hold on to the rest of the company.
Caesars CEO Tom Reeg said, “We have found an owner for the William Hill business outside of the United States that shares the same objectives, approaches, and longer-term ambitions of that business.”
SAVINGS ON COSTS
Because of the relative proportions of the firms, Pazner said the purchase, which is classified as a reverse takeover under UK listing regulations, will help 888 to be more competitive and gain market share in many of its main areas.
In addition to the United Kingdom, William Hill, which was formed in 1934, has operations in Spain, Italy, and the Nordic countries.
The Dalia Shaked Trust, 888’s top stakeholder, expects cost savings of at least 100 million pounds per year from the acquisition, which has the endorsement of the company’s largest shareholder. 888 is owned by the trust to the tune of 23%.
888 is hoping to raise 500 million pounds from investors through a share sale “at the right time,” which has weighed on its stock price in early trading.
888 has outbid Apollo for the William Hill assets, according to the New York Times.
By 0842 GMT, 888’s shares, which had gained 40% this year, were down 1.4 percent, trailing the overall index’s 0.5 percent decline.
888, which has a market capitalization of 1.5 billion pounds, announced that it has received 2.1 billion pounds in debt financing from banks to support the purchase, which includes 0.7 billion pounds in William Hill bonds.
