- Scientific Games has sold its sports betting business, OpenBet, to Endeavor Group Holdings.
- This was a $1.2 billion acquisition.
- The deal will officially be complete in Q2 of 2022.
LAS VEGAS – Scientific Games is moving on from its popular OpenBet sports betting business, selling the product to Endeavor Group Holdings.
This purchase will see Endeavor acquire OpenBet for $1.2 billion. The $1 billion will be paid to Scientific Games in cash while the remaining $200 million would come from Class A common stock.
OpenBet is a world leader in global online sports betting technology with over 75 global customers, including 24 sportsbooks in the US. This is a major acquisition for Endeavor.
Endeavor Meets OpenBet
Endeavor is a sports and entertainment company with products seen globally. The purchase of OpenBet is aimed to advance Endeavors product offering, while also increasing Scientific Games’ position in the market.
“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. “The transaction is a significant milestone towards optimizing our portfolio and de-levering the balance sheet to enhance our financial flexibility. It will position us to invest both organically and inorganically in key growth areas, particularly in content and digital markets. We are delivering on our promises and executing on our strategy to transform our company and unlock significant value for employees, customers and shareholders.”
Popular sportsbooks that now fall under the Endeavor umbrella with this purchase will include BetFred, BetMGM, FanDuel, Golden Nugget, and WynnBET.
In one acquisition, Endeavor will have grown its USA online gambling market share exponentially.
How Big Is The Deal?
Endeavor already owns IMG Arena and the combined revenue from both IMG and OpenBet is projected to be an estimated $340 million by next year. OpenBet alone should be adding $150 million to the 2022 fiscal year.
“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 sports books and fans,” said Ariel Emanuel, CEO, Endeavor. “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.”
This deal has already seen Scientific Games’ stock jump following the announcement. Due to required regulatory approval, the acquisition will not be closed until Q2 2022.