Scientific Games Corporation has confirmed that its Openbet subsidiary will be sold to Hollywood based sports and entertainment group Endeavor Holdings for a total consideration of $1.2 billion (€1.05bn).
Reaching definitive terms, Endeavor – the investment fund of US entertainment moguls Ariel Emanuel (CEO) and Patrick Whitesell (Chairman) – will pay $1 billion cash and $200 million in Endeavor NYSE Class-A stocks to take full control of Openbet.
Endeavor branded the acquisition as transformative for its wider organisation, as Openbet technologies will help its sports and entertainment subsidiaries leverage their services within the multi-billion US wagering market.
The owner of the UFC, IMG, EuroLeague Basketball, Miss Universe and William Morris Agency – Endeavor made its NYSE debut last April after securing a +$10 billion valuation billing itself as the disruptive entertainment group for a new generation of audiences.
“OpenBet has built an incredible sports betting suite anchored in its best-in-class betting engine and now including expanded content, services and products for sportsbooks and fans,” said Emanuel.
“This capability set is the ideal complement to our IMG ARENA sports betting business, which works directly with sports rights holders. We look forward to growing these businesses together to capitalize on the strong secular tailwinds in the sports betting ecosystem.”
The transaction sees Scientific Games complete the first phase of its ‘strategic unit divestment’, sanctioned by Chairman Jamie Odell with the aim to deleverage the Nasdaq technology group’s $9 billon corporate debt.
“This transaction represents the culmination of a thorough process to divest OpenBet in order to maximize value for our shareholders and rapidly advance our vision to become the leading cross-platform global game company,” said Barry Cottle, President and Chief Executive Officer of Scientific Games.
“We are delivering on our promises and executing on our strategy to transform our company and unlock significant value for employees, customers and shareholders.”
Scientific Games had acquired Openbet in 2018 as part of its €650 million takeover of NYX Gaming – as the technology group moved to expand into the online gambling sector.
Renowned for its upkeep and scalability, Openbet is regarded as sports betting’s leading systems supplier, servicing 75 customers worldwide including the tier-1 betting firms of Sky Bet, William Hill and Ladbrokes.
Openbet’s US clients include TheScore, DraftKings, BetMGM and FanDuel, who will be monitoring Endeavor developments closely as the marketplace and its technology landscape are further reconfigured by M&A activities.
“We believe Endeavor will enable us to build on our exceptional track record of innovation and reliability and unlock even greater value for our customers and employees,” said Jordan Levin, Chief Executive of Scientific Games’ Digital business.
“Endeavor’s deep industry relationships and global reach make them the ideal partner. Together, these companies will be well-positioned to capitalize on emerging trends to deliver even more innovative and tailored solutions to customers as we define the future of sports betting entertainment.”