With gambling regulations impacting on yoy earnings, UK bookmaker William Hill announces an exclusive partnership with Eldorado Resorts in the United States.
The joint venture will see William Hill open five retail sportsbooks in Eldorado’s prestigious casinos across three states in West Virginia, New jersey and Mississippi, as well as online betting and the provision of online casinos, following legalisation in each US state.
This partnership could extended to a further 26 properties across 13 states with a customer reach in excess of 23 million a year.
Under the terms of the agreement Eldorado Resorts will receive $50M in William Hill PLC shares and a 20% stake in William Hill US subject to a 5 year lock in.
Both parties will jointly share the investment costs in building the first 5 sportsbooks and the agreement is based on a 25 year term, with the option to extend further.
William Hill’s current arrangement with Eldorado is already paying dividends, with the bookmaker claiming a 31% slice of the US sports betting market.
Following the announcement William Hill CEO Phillip Bowcock emphasised the huge opportunities ahead in the US, he said:
“Partnering with Eldorado gives William Hill access to one of the largest and most attractive casino footprints with 23M customers across multiple states. This provides extensive cross-sell and profit growth opportunities for both parties. We’re positioned to capture the evolving US opportunity – starting with land based sports betting and extending to digital sports betting.”
Eldorado Resports Inc CEO Gary Carano went on further to highlight value William Hill brings to the partnership, he commented:
“Having worked with [William Hill] since 2012, we believe William Hill represents the gold-standard in global sports betting and we are confident that our expanded partnership will be successful.”
While most bookmakers such as PaddyPower and 888sports are focusing on providing online content (which is where most users will access their products), William Hill wants a strong presence in more traditional bricks and mortar casinos.
The UK bookmaker is in a great position to capitalise in the retail sport betting market, having worked closely with Eldorado in Nevada since 2012. The first five sportsbook’s should be complete by the end of the year.
Turbulent times for bookmakers…
The US supreme courts decision to legalise sports betting in some states could not at a better time for the industry, as headwinds from regulators are likely to affect to hit profits.
In May 2018 the UK government ignored pleas from bookmakers and decided to limit the stake punters can place on fixed-odds betting terminals (FOBT’s) from £100 to £2. With bookmakers deriving more than half of their revenue from fixed-odds betting terminals, sportsbook’s like William Hill are desperate to find other sources of income.