A Grand deal for William Hill
A Grand deal for William Hill
The news that gaming technology specialist Grand Parade was to be bought by William Hill was one of the more surprising M&A tales to emerge from the sector in the past few months.
The £13.6m cash and shares deal came out of the blue and to an extent caught market-watchers on the hop, particularly given the news the week before regarding the prospect of a joint offer for William Hill from Rank and 888.
It also came a matter of two days before William Hill was delivering what had already been prefigured as a poor set of results and a matter of weeks after its lost its chief executive James Henderson.
To its credit, however, William Hill has clearly not let such issues cloud its judgment over what looks to be a great deal for all involved.
Grand Parade is one of the leaders in the drive towards greater personalisation in gaming and betting. It’s interactive scoreboards, app capabilities and content-driven advertising and bet recommendation engines are some of the smartest and most successful in the business.
Considering it has worked in the past with some of the biggest names in the business - Ladbrokes, pre-merger Betfair, pre-GVC Bwin, Coral and Sky Bet - it is perhaps surprising that the London and Krakow-based firm isn’t more well known.
Word from inside both camps this week was that the deal has been very quick to complete (at least in normal M&A terms) such is William Hill’s desire to add Grand Parade’s capabilities to its own operation.
In most analysis of the deal the name of the company’s long-standing Project Trafalgar has featured prominently with many speculating about what this would mean for that arm of William Hill’s online plans.
At this stage it is hard to say what it might mean for the company’s currently online development teams dotted between Gibraltar, Leeds and Shoreditch in London. What we do know is that along with Grand Parade’s own team just down the road in Southwark, William Hill will also add a development team numbering 170 in Krakow and a number of relationships with clients that will now have to be re-assessed in light on the buyout.
For instance, Grand Parade is thought to be working extensively on the SunBets project and it might be that this involvement will cease once William Hill take the reins. Other work, though, will carry on, including a project the company is working on in conjunction with ITV which (to date at least) it has been very hush-hush about.
We also know that the management team from Grand Parade will be staying on after the deal completes, in particular chief executive Andy Clerkson who founded the business back in 2007 and chief technology officer Dominic Hawken.
Philip Bowcock, the interim chief executive at William Hill was undoubtedly correct when he said in the news release for the deal that the addition of Grand Parade would ramp up its development effort. The admittance that it was also “backfilling existing resource gaps” points, though, to how much William Hill probably now feels it has fallen behind the opposition when it comes to its online business.
Giving a nod to William Hill’s other bit of recent business, the financing of NYX Gaming’s buyout of OpenBet, Bowcock added: “This enables us to capitalise on the potential of our Trafalgar front-end platform by accelerating our product development and also to support the work with OpenBet to build our new back-end platform."
New online chief Crispin Nieboer has been busy since taking the reins under Henderson’s watch, attempting to turn around an operation which it is commonly felt had lost its way in recent years. From being among the market leaders online the company has lost position, particularly to major rivals and soon-to-be-merged Ladbrokes and Coral. Grand Parade will provide some useful ammunition in the fight ahead.
Totally Gaming says: The addition of the resources of Grand Parade won’t be bringing any instant fixes but give it time and the acquisition might well prove to be a turning point in the evolution of William Hill’s online business. The opposition know very well Grand Parade’s strengths and they will no doubt be watching developments with keen interest.