As this morning 888 Holdings is declared the winning bidder of Caesar Entertainment’s auction of William Hill’s non-US assets – uncertainty remains as to the future of the heritage bookmaker’s retail unit and how it will reshape betting’s presence on the high-street.
The deal will enable 888 to quadruple its market share, becoming the third-largest group operator in the UK on a consolidated basis at the expense of bet365, with Flutter Entertainment and Entain taking first and second place respectively.
Additionally, the UK market now accounts for 70% of 888’s combined revenue, with 40% of the firm’s British earnings now coming from retail holdings – according to research from Regulus Partners – a vertical which is more stable than online operations with regards to regulatory oversight.
Online has been the primary target of the UK government’s review of the 2005 Gambling Act, and as a result retail sectors have enjoyed greater regulatory stability.
However, retail betting has been affected by periods of lockdown-induced temporary closure, whilst William Hill shut down many of its high-street betting shops in 2019 and 2020 after the imposition of the £2 stake limit on FOBT games.
Despite headwinds, commercial interest in the retail sector remains, with incumbents keeping a keen eye on 888’s plans for William Hill’s retail holdings.
Betfred founder and CEO Fred Done in particular was said to be interested in acquiring William Hill’s suite of 1,400 remaining betting shops – the largest chain of high-street bookmakers in the country – with the aim of expanding his already extensive retail presence.
The Warrington-headquartered company’s biggest competitor in a bidding contest for Hill’s retail offcuts would likely be Irish bookmaker BoyleSports, which is currently in the process of an expansion of its UK operations, and had expressed a desire to acquire ‘some-or-all’ of the company’s betting shops.
A statement from the company at the time read: “We already have 21 shops in the UK which, along with our 45 shops in Northern Ireland and our recently upgraded online betting site, gives us a sizeable foothold in the UK. “The sale of the William Hill estate presents us with a rare opportunity to achieve the retail scale we have been targeting.”
BoyleSports’ previous forays into the British betting and gaming market have seen success. Ireland’s second-largest market secured 13 betting shops throughout the Midlands region in 2019 from independent bookmaker Wilf Gilbert.
Meanwhile, Apollo Wealth Management is still circling William HIll’s assets, having been beaten in the race to acquire the company’s non-US holdings by 888, and previously losing the bidding contest for the entity of the former FTSE250 company to Caesars.
The US gambling and entertainment conglomerate’s successful acquisition of William Hill for $2.9 billion in April promoted the sell-off the Gibraltar-registered firm’s divisions on the European side of the Atlantic, as Caesars was primarily interested in leveraging its acquisition’s online verticals to bolster its position in the expanding North American market.
As well as Fred Done, Apollo and BoyleSports, a range of other prominent gamblig incumbents had previously eyed up William Hill’s remaining operations, and could still be viewed as potential players in further M&A developments.
Entain – which maintains substantial retail holdings of its own through Ladbrokes and Coral – also closely monitored Caesars’ William Hill sale, a move which would significantly expand its already extensive presence on the British high-street, controlling 40% of all UK betting shops.
Following years of reluctance, William Hill has found two M&A dance partners in the space of six months – transforming the landscape of US and UK wagering.
Betting’s glaring M&A spotlight will now shift to 888 CEO Itai Pazner, as the orchestrator of William Hill’s next transformation.
888 will have achieved its long-standing objective of entering UK gambling’s ‘Big 4’ enclosure, yet Pazner and co will be aware of post M&A challenges taking the hand of UK betting’s grandest belle.