Good morning. Welcome to the new-look Monday edition, the Cheat Sheet, designed to give subscribers a heads up of what will be driving the news in the week ahead. In this first edition:

• Analysts say MGM’s Osaka IR could ‘top Singapore’.

• Better Collective makes a M&A move in adtech.

• The week ahead looks forward to Las Vegas Sands and Entain.

• Startup focus for this week is social-betting outfit Kutt.

Osaka.

Sizing Osaka

The long journey towards resort casinos in Japan is coming to a conclusion.

Ten years after: A decade after the potential for Japan to legislate for integrated resorts casinos, as noted by analysts at CBRE, MGM got the nod for an Osaka property – receiving official notification for the development with an opening date penciled in for 2029.

• The decision from Japan’s Ministry of Land, Infrastructure, Transport and Tourism “seemingly [cleared] the last major hurdle to move forward,” the CBRE team added.

• “The dream of a land-based casino coming to Japan came to fruition,” said JMP.

• CBRE noted the initial investment stands at $8.2bn, with MGM saying the total outlay will be $10bn between it and its partner Orix.

• What does $10bn get you? Around 2.5k hotel rooms, 400k square footage of conference space, another 300k sqft of expo space and a 3.5k seat theater.

How much? CBRE went on to suggest the Osaka casino “could top Singapore”, noting the local population of 19m is three times that of the city state and also draws in much local tourism. Notably, Austrian Casinos’ Nagasaki project is yet to get government approval.

• While MGM and Orix said in their proposal the Osaka market could be worth $3.9bn of net revenue, CBRE cited their own Dec21 report where they suggested a TAM of $5.75bn.

• Moreover, the MGM/Orix estimate likely envisaged competition in Tokyo, which, in reality, could be years behind Osaka.

• JMP said the project could also eat into the estimated ~$4bn pachinko business in Osaka. 

• CBRE predicted the EBITDA potential for the IR could be upwards of $2bn, “making it one of the most profitable casinos in the world”.

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Better Collective’s adtech push  

Affiliate giant says £45m acquisition of Skycon adds to adtech push. 

Skylarking: Better Collective made another step towards its goal of becoming a sports digital media player, with the acquisition of the adtech provider Skycon for an initial £25m in cash with £20m of earnouts.

• No financials were given for Skycon but Better Collective did add €15m to its top-end forecast for this year and €5m of EBITDA, taking each to €31m and €105m respectively.

Con air: Skycon is a display advertising specialist and analysts at Redeye noted it would complement Better Collective's own paid media division. 

• Three guesses: The Stoke-on-Trent business currently has only one gambling client. 

• Better Collective said it would be offering Skycon’s services to a wider portfolio of sportsbook clients. It said at least 50% of the earnout would be funded from plugging Skycon into existing revenue share agreements.

• Skycon was founded in 2017 by Ben Longstaff and David Morris, who previously sold a gaming affiliate business to Catena Media in May that year.

E+M week ahead: See tomorrow’s edition of Due Diligence for more on Better Collective’s M&A strategy.

Share watch

Not out of the woods: 888 has regained a portion of the ground lost since the news of its Middle Eastern VIP issues but remains down 15% since the start of the year. Recall, on Friday it said it was back taking new customers from the region.

🧐 888 yet to recover from the late January share price shock

Datalines – New Jersey

FanDuel’s sports-betting market share fell to a 13-month low in March, according to Wells Fargo estimates.

A low point: According to the WF team, FanDuel fell from its market share highs of 63% and 56% in January and February respectively. The 41% market share for March is its lowest for over two years. 

• DraftKings was second with 29%, its highest total for over two years.

• Marketwide sports-betting GGR rose 40% to $93m but handle of $1.02bn represented a YoY fall of 8%.

🛝 FanDuel’s New Jersey sports-betting market share on the slide 

Datalines – Illinois

Sports-betting revenue for March nearly doubled to $68m, with FanDuel taking the lion’s share at 49%. DraftKings took 27% market share.

The week ahead

Las Vegas Sands: Expectations over the faster-than-expected return in Macau will bed up for discussion on Wednesday. Analysts at Wells Fargo suggested LVS’s mass market slot play will come in at ~60% of 2019 levels, a potentially slower ramp vs. peers.

• The impact of the China opening on Singapore is less clear, however. “Many wealthy Chinese had ‘decamped’ to Singapore in early 2020,” the team added. 

• “But we believe higher visitation and airlift (with more from China) should support Singapore's recovery trajectory.”

🌤️ LVS YTD: Expectations are rising about the Macau recovery

Entain: A little over a month on from its FY22 statement, the company returns to the fray with its Q1 results on Tuesday. At the time, the company said it had seen “positive underlying momentum” in 2023.

• A spat: Jefferies analysts warned over some consensus confusion ahead of the figures, noting that half-a-dozen analysts – including Jefferies themselves – have been excluded from consensus estimates for profit.

• Out in the cold: Jefferies believe they have been excluded due to differences over how the analysts treat depreciation and share-based payments.

• 🤷What does this mean? We’re guessing, not a lot.

Calendar

• April 18: Entain Q1, E+M Due Diligence

• April 19: Las Vegas Sands

Analyst takes

DraftKings: Jefferies analysts suggested rival Flutter’s likely move to dual list in the US will be good news for several of its competitors in the sports-betting space, and DraftKings in particular.

• Meanwhile, the team indicated that, despite economic headwinds, DraftKings “continues to thrive”, noting that Google search trends suggested “continued robust interest compared with other wagering brands”.

Startup focus – Kutt

The final Kutt: Kutt is a social betting platform founded by Sim Harmon formed on the premise that the amounts that are bet with friends far outweighs the amounts bet with the ’books. Kutt cites the AGA, which has previously said a figure of $150bn, so that must be right, yes?

• It’s your money I’m after, baby: Kutt has raised undisclosed sums from angel investors and syndicates. A Seed round is forthcoming.

Spaghetti junction: Kutt says it lies at the intersection of betting, payments and, yes, social networks. “Being a part of a community that allows you to bet directly against your friends and fellow fans is the future,” says Harmon.

• The plan involves keeping customers acquired via social platforms engaged. “Churn is crazy in this space – building an innovative platform that actually offers users an experience they can't find anywhere else is Priority 1, 2, and 3 for our team.”

Big number: The company says the app – which launched in Q422 – has facilitated over $150k of bets so far.

Growth company news

• U.S. Integrity has announced a partnership with sportsbook soon-to-launch regulated Canadian OSB operator NEO.bet.

• Sports-betting platform Amelco is set to integrate Simplebet’s micro-betting products as part of a supply agreement between the two groups. 

• SportsGrid has released its first D2C app, incorporating news, statistics and real-time odds for use by bettors and fantasy sports customers.

• ALT Sports Data has partnered with the World Surf League as its official data distribution partner, leveraging its proprietary simulation trading platform to enable sports betting on WSL's Championship Tour events.

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Newslines

Circa will open a sportsbook at Full House’s Temporary casino in Waukegan in the third quarter, according to the Chicago Tribune.

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