888 shareholders approve William Hill acquisition
888 will buy William Hill’s non-US assets from Caesars for £1.95bn.
UK.- The shareholders of 888 Holdings have approved the company’s deal to acquire the non-US assets of William Hill from the US casino giant Caesars Entertainment. Caesars bought William Hill last year for £2.90bn but made clear from the outset that it would offload the European part of the business.
888 reached a deal to buy those assets in September, but since William Hill’s assets are larger than 888’s current business, the deal is classified as a reverse takeover, needing approval from 888’s shareholders. The result of that is 307 million votes – 99.7 per cent of voting shares – in favour, and only 819,264 against. 888 expects to complete the deal on or around June 30.
Lord Mendelsohn, non-executive chairman of 888 Holdings, said: “We are delighted with the support of our shareholders for our proposed acquisition of William Hill and would like to thank them for their continued, constructive engagement as part of this process.
“We look forward to completing this transformational acquisition at the end of June, creating a global online betting and gaming leader through the combination of two highly complementary businesses and two of the industry’s leading brands.”
888 has said the combined business would be the third-largest publicly traded online gambling operator in the world, becoming “an attractive omni-channel opportunity in the UK” and creating “a transformational opportunity for 888 to significantly increase its scale, further diversify and strengthen its product mix, and build leading positions across several of its key markets”.
The deal is intended to diversify and expand 888’s presence in sports betting in regulated markets while gaining scale to achieve cost savings of £100m a year by 2025. The company would achieve that by creating a single proprietary platform for the combined business and by removing duplicate marketing and licence costs.
888 Holdings reached an agreement for a reduced price for the acquisition, saving it £250m, £100m of which will be kept as a 2024 earn-out incentive depending on EBITDA performance.
888 said the seller, Caesars Entertainment, had agreed to lower its enterprise valuation of William Hill from £2.2bn to between £1.95 and £2.05bn due to a change in macroeconomic conditions and regulatory compliance factors since the original deal was made in September 2021. It still expects to finalise its takeover of William Hill by the end of H1 trading.
The reason for the reduction in value is a Gambling Commission licence review, which 888 believes will result in losses for William Hill. Regarding the potential impact of the new legislation, 888’s board had said that if the UK introduces a £2 per spin limit on online slots, bringing them in line with land-based FOBTs, that would hit anticipated revenue to the tune of £55m a year and EBITDA by £16.6m.
