Earnings+More - Deal Talk #7
Deal Talk #7Is the deal-making winter coming to a close? MGM sets a path ahead, the latest deals +MoreHello and welcome to edition #7 of Deal Talk. This month we are discussing:
I've reached the turning point. Have the capital markets turned?Going by share price performance since the turn of the year and capital raising activity, we might be seeing the green shoots of returning corporate activity. Reading the runes: It is the nature of the markets to always be on the lookout for turning points, particularly when coming out of a trough. Huge significance is placed on the share price movements of sector bellwethers, hence the interest that was shown in the performance of DraftKings.
Animal spirits: Those involved in corporate development agree that there is every indication that sentiment has shifted from the negative backdrop being spoken about for much of 2022.
** SPONSOR’S MESSAGE ** Tried, tested and proven over a decade in the highly-regulated US market, and continuing to expand across Europe, Latin America, Asia and Africa. GeoComply harnesses the power of its market-leading geolocation technology to protect against fraud, including fake account creations, bonus abuse, account takeovers, stolen identities, money laundering, and more. Visit geocomply.com. The unemployment lineUnquiet quitting: One corporate financier who wanted to remain anonymous points out why DraftKings’ redundancy news was so well received. “There’s been a view among investors that the leaders in this space were willing to invest in growth at all costs despite their objections,” they suggest.
Leyland suggests that the share price reactions to redundancies, not just at DraftKings but also at Bally’s, are “definitely” being viewed as a good thing by the markets. Yet, as Chris Grove, partner at Acies Investments, points out, these remain isolated to a handful of companies in the space rather than the widespread job losses seen in the tech sector.
Capital moveNickels and dimes: The clearest sense of optimism returning comes from recent capital raises undertaken by the gaming REIT VICI, which raised $1m via a share sale, and Caesars, which recently completed a bond-and-debt raise worth nearly $4bn as well as pushing out its maturities.
Ultimately, the hope is that willingness to open up the doors to funding will trickle down to the rest of the market. But as Grove points out, access to capital is “still very much a company-by-company situation”.
Downdraft: Catlin suggests there might be “another leg down” within the next three-to-six months. “On the spectrum of fear and greed, it feels like the world rushed back towards greed,” he says.
Further reading: The big short is over but investors are in danger of “sleepwalking into a sell-off”, says Bank of America. ** SPONSOR’S MESSAGE ** Founded in 2013, Metric Gaming is based in Las Vegas and London and developed the industry’s first truly multi-tenant sportsbook platform, purpose-built to support operators across multiple territories, regions or States. Metric is proud to be partnered with both Racebook HQ and Lacerta Sports (powered by Starlizard) and will roll out innovative MTS solutions for both racing and sports in 2023, including soccer and four main US sports. To find out more, please visit www.metricgaming.com MGM’s path aheadThe comments from MGM Resorts boss Bill Hornbuckle appeared to catch Entain investors by surprise – but maybe they were guilty of not paying attention. No means no: Taking the opportunity of MGM’s recent earnings call with analysts, Hornbuckle made it plain that the gaming giant would no longer be pursuing any type of M&A regarding BetMGM JV partner Entain.
🤿 Entain’s share take a dive following MGM’s earnings call comments He’s just not that into you: As a previous Deal Talk indicated, while Hornbuckle had said publicly that MGM would want to own more of BetMGM, there was no easy pathway for this to happen.
Go your own way: This was confirmed last week when Hornbuckle said MGM was “going to go down our own direction” and would allocate capital accordingly. “When you talk studio business or even live dealer, the technology aspect of that is, on our scale, relatively de minimis,” Hornbuckle said.
The month in dealsDeal of the month: DoubleDown Interactive’s buyout of SuprNation sees the social gaming operator make a move into real-money gaming via the flagship Duelz.com business. Moreover, by making the point that it was DDI’s “first acquisition” in the RMG space, it was clear it will be making more forays.
REIT movesVICI: Along with its $1bn capital raise, the leading gaming-related real estate investor also completed the acquisition of the MGM Grand and Mandalay Bay from Blackstone for $1.27bn and announced a sale-and-leaseback of four casinos from Pure Canadian for $200.8m. Affiliate M&AStake size: As noted last month, M&A in the affiliate space made something of a return at the end of last year with GiG’s buyout of the AskGamblers assets from Catena Media. That has now been followed by news that Better Collective has taken a 5% stake in Catena.
An +More Media publication. For sponsorship inquiries email scott@andmore.media. Earnings+More is free today. But if you enjoyed this post, you can tell Earnings+More that their writing is valuable by pledging a future subscription. You won't be charged unless they enable payments. |
Key phrases
Older messages
Exclusive: Bally’s looking to sell Monkey Knife Fight
Tuesday, February 14, 2023
Bally's MKF sale deck, Bally's new CEO and Q4 earnings, Betsson Q4 earnings, Macau better than expected +More
CaliPlay legal tussle takes a turn
Monday, February 13, 2023
Caliente's CaliPlay complaint, Super Bowl thrills, DraftKings is the standout in the week ahead, startup focus – Deep CI, Iowa's de facto market exits +More
Weekend Edition #84
Friday, February 10, 2023
DraftKings' Sell note, FanDuel's New York dominance, Super Bowl set to break $1bn, Wynn's new notes +More
MGM: it’s a ‘no’ on Entain
Thursday, February 9, 2023
MGM says it's time to end the Entain M&A speculation, Wynn Resorts says it is seeing a non-junket VIP return +More
Kindred provisions for £7.1m UK fine
Wednesday, February 8, 2023
Kindred sets aside funds for UK regulatory settlement, UK ministerial reshuffle uncertainty, Red Rock looks to Durango completion +More
You Might Also Like
Play and Earn with Dimension X; Elixir Games Season Pass; The Machines Arena Open Beta; Worldshards dropping NFTs during early access; Life Beyond preview and more in Play to Earn Newsletter #225
Saturday, May 4, 2024
May 04, 2024 Pixels remains on top; My Neighbor Alice Beta; new Unity build for Voxie Tactics; Wanderers Closed Beta; Paradise Tycoon mint; Dimension X Arenas, and more in Play to Earn Newsletter #226
The Three SaaS Metrics That Matter in 2024
Saturday, May 4, 2024
The three most under-discussed metrics To view this email as a web page, click here saastr daily newsletter The Three SaaS Metrics That Matter in 2024 with SaaStr Founder and CEO Jason Lemkin By Amelia
Does experience matter?
Saturday, May 4, 2024
Also: Forecasting private capital's path to $20 trillion in AUM; Recapping market performance in April; Can payments re-energize enterprise fintech? Read online | Don't want to receive these
'You Have To Bring Solutions, Ideas and Be Prepared'
Saturday, May 4, 2024
We spoke to Alabama Assistant Basketball Coach Ryan Pannone about lessons from coaching across the globe and keys to advancing a career.
The curious case of Google Trends in India
Saturday, May 4, 2024
For nine of the last ten years, the most searches were for why Apple products and Evian water are so expensive ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
3,500 sign ups in 24 hours
Saturday, May 4, 2024
Today's hack Do you piggyback on Slack communities? ;) Noam Schwartz gained 3500 sign ups in 24 hours. Recently I received an email from Noam Schwartz - a member of our gorgeous community: I did an
Your Personal Trainer for Making Sales
Saturday, May 4, 2024
If you want the best results, you're going to need the best trainer... View in browser ClickBank When you're at the gym, you can do one of three things: Use the machines randomly Follow a
Zhipu AI: The Rise of an AI Tiger Reaching for AGI
Saturday, May 4, 2024
The only overview of Zhipu AI's technology, open-source efforts, partnerships, and future goals in English
So long, Henry.
Friday, May 3, 2024
A combined issue flush with key insights and original thoughts in two new, data-driven reports. View this email in your browser So long, Henry. (No. 994). The economy is squeezing consumers to the
He survived all recent Google updates
Friday, May 3, 2024
Advice from Birdzilla's founder