Stars Group poised for PASPA repeal after Sky Bet acquisition

Stars Group poised for PASPA repeal after Sky Bet acquisition

Tuesday, April 24, 2018 Posted by Michael Lawson
No alternative text provided
The overall value of the deal was $4.7 billion.

The Stars Group has announced an agreement to acquire Sky Betting & Gaming (Sky Bet) from CVC Capital and Sky plc, in a cash and stock transaction valued at $4.7 billion.

The high-profile deal will result in the world’s largest publicly-listed online gaming company, and leaves Stars Group ideally positioned to further penetrate the US market in the event of the federal ban on gambling being lifted.

The state of New Jersey is currently embroiled in a case with the US Supreme Court to repeal the Professional and Amateur Sports Protection Act of 1992 (PASPA), with a decision looking to be made in the coming months.

The acquisition will provide the Stars Group with further operational and financial benefits, including:

  • Greater revenue diversification and significantly enhanced exposure to sports betting, the world’s largest and fastest growing online gaming segment, as the majority of SBG’s revenues are generated by sports betting.
  • An increased presence in regulated markets, particularly within the United Kingdom, the world’s largest regulated online gaming market.
  • The development of sports betting as a second low-cost customer acquisition channel, complementing The Stars Group’s core poker business and enabling more effective cross-sell to players across multiple verticals.
  • Improved products and technology as a result of the addition of SBG’s innovative casino and sports book offerings, and portfolio of popular mobile apps. Identified cost synergies of at least $70 million per year.

“We are delighted to join forces with The Stars Group,” stated Richard Flint, Sky Bet CEO.

“We have had a fantastic last few years and would like to thank CVC and Sky for supporting us in becoming a leading online operator in the UK. This transaction allows us to offer our best-in-class products to a truly global audience. We’re excited about our future together.”

Commenting on the sale, Pev Hooper, Partner at CVC Capital, added: “Richard and his team have done a fantastic job building Sky Betting & Gaming into one of the UK’s largest and fastest growing operators.

“We have thoroughly enjoyed working closely with the team and our partners at Sky. This combination with The Stars Group opens a new and exciting chapter for SBG to accelerate its international growth, and we look forward to continuing the journey as a shareholder in the combined group.”

Totally Gaming says: The figure of $4.7 billion paid by Stars Group for the acquisition of SkyBet has shocked many in the industry. There’s no denying that it is a sizeable fee, but could still yield solid returns if it coincides with the opening of the US market.

Tags: 
Latest
Horse Racing

William Hill to overhaul racing product with The BetMakers

Job

Kambi seals Pennsylvania sportsbook supply deal

Liverpool FC footballer charged with FA betting rule breaches

Finance

Gaughan set to stop down as Sportech chief executive

Gaming Products & Services Directory

The essential directory for the gaming industry