Good morning. Welcome to your early weekender. On the agenda today:

• MGM Resorts says it is back to normal following hack.

• SBC Summit Barcelona kicked off with discussions around M&A.

• Roundhill’s Sports Betting and iGaming ETF is switching its index.

• Better Collective, FDJ and IGT all feature in the M&A notebook.

• A data scientist and a CMO role are available at BettingJobs.

Take off them fabricated streams and them microwave memes.

Loss adjuster

MGM Resorts said on Wednesday operations are back to normal 10 days after the cyberattack.

The all clear: Taking to X, formerly Twitter, MGM Resorts said all its operations were back to normal following 10 days of disruption caused by the cyberattack. The news came a day after analysts at JMP said the company would have been covered by its insurance for losses of up to $200m.

• “MGM is covered by insurance, for now,” the team suggested after seeing business across its Las Vegas and regional casino estate disrupted by the attack.

• The suggested rise in premiums would be a “drop in the bucket” for the company.

• The team also said that industry chatter suggested if there was any ransom paid it would have been between $30m-$50m.

• The Las Vegas Review Journal cited cyber experts as suggesting things could have been worse if MGM had not moved expeditiously to shut down its slot operations.

• Experts said the hackers were attempting to program slot machines to produce fake ticket-in/ticket-out tickets that would be redeemable for cash. 

• But they noted that MGM has lost ~$850m of value in the last week as the shares wilted by minus 6% on the news.

🥷 MGM under attack

Eye-popping: Returning from a series of management meetings last week, the team at Macquarie suggested the level of disruption was “eye-opening as property internet, reservation desks, check-in desks, elevators and machines were not running smoothly”. 

• Still, the team said they believe the “financial damage was contained and relatively minimal” at ~$15m for Caesars and $20-40m for MGM. 

• “Per prior channel checks, the city was full as occupancies have been well into 90% and price points remain healthy,” they added.

Phew: JMP noted that historical precedent shows that past hacks – including one that affected DraftKings in late 2022 – “have not impacted long-term revenue and, in turn, companies saw a recovery in the stock price”. 

• “We do not know the timeline of when operations will return to normal, but our checks indicate MGM is still experiencing day-to-day issues that could persist for a period of time,” they added.

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SBC day one review

The SBC Summit Barcelona kicked off yesterday with discussions around M&A.

Is it a bird? “I don’t know whether FanDuel is an M&A story or an organic growth story,” said Flutter International CEO Daniel Taylor from the stage in Barcelona yesterday as he acknowledged that M&A can be a “useful platform for growth”. Recall, Flutter bought the then DFS-only FanDuel just as the US was on the cusp of expanding regulated sports-betting.

• “We aim for the gold medals,” he added. “Fundamentally we believe that it is important to have leadership positions in the markets we care about.”

• He said Flutter believes that scale is important “in terms of building that competitive advantage”. 

• “We are believers that striving for scale allows investment and high-revenue growth, drives greater operational leverage back into the business, drives more scale and that repeats.”

Sitting on the same panel with Talylor, Gustaf Hagman, CEO at the MGM-owned LeoVegas also said the focus for markets going forward was on regulated markets and “not too much into grey markets”.

• “Things are happening around the world, in Brazil and also in Africa. There are some exciting countries coming up and a lot of land grab to do.”

On the agenda

Doors to manual: The talk on the Expo floor has been the rise of crash games and at 11:20am on stage three, Laura Petrauska from Bet99, Eyal Loz from RubyPlay and Vladimir Malakchi from Evoplay ask the question whether such games are influencing slot innovation. The answer is yes if you want to cut to the chase.

• At the same time on stage one, a panel looking at the tricky subject of what happens in North American markets when the bonus money runs out will be tackled by, among others, Seth Schorr from Fifth Street Gaming and Kresimir Spajic, newly installed CEO at Betfred US.

• LatAm opportunities will be given another spin later on the same stage at 1:20pm with Gonzalo Pérez from Apuesta Total and Livia Troise from Betmais among those discussing how to navigate shifting political sands.

• The increasing cost of content will be the subject at 2:20pm on stage two when Dominic Crosthwaite, chief trading officer at Flutter Entertainment and his colleague Aidan Barry, group head of sportsbook product performance and trading strategy at Fortuna Entertainment Group, will be among those asking – and maybe answering – the question of whether data and content cost inflation is sustainable.

M&A notebook

Better Collective has snapped up long-standing Danish tipping site Tipsbladet.dk, one of the leading soccer media in the country, for €6.5m. Tipsbladet was founded in 1948 and launched its online version in 2000.

FDJ: France’s competition regulator has cleared the lottery operator’s bid to acquire online horse racing betting site ZeTurf Group. However, the regulator has ordered FDJ to address competition concerns, particularly with regard to separating its monopoly and competitive gaming operations. 

IGT: The analysts at Jefferies suggested that Apollo’s reported $4bn-$5bn bid for the gaming elements of IGT “should not be surprising” given the PE giant’s history with gaming and gaming equipment assets. 

** SPONSOR’S MESSAGE ** Huddle has been shortlisted to win the prestigious Rising Star in Sports Betting Innovation / Software award at the 2023 SBC Awards in Barcelona. The SBC Awards ceremony takes place on Thursday, 21st September 2023.

Huddle will be represented at the Summit all week, so feel free to reach out if you’d like to learn more about Huddle.

Explore more: https://huddle.tech/

Changing track

Roundhill’s Sports Betting and iGaming ETF is switching its index.

Cross the tracks: The only exchange-traded fund dedicated to the online gambling space has switched to a new index that has been developed by Morningstar. The ETF, which trades under the ticker symbol BETZ, was previously following Roundhill’s own index. The new index will be adopted at the start of October.

• As with the current index, the new Morningstar version is similarly designed to provide targeted exposure to companies involved in the global sports betting and online gaming industry.

• The BETZ ETF currently holds 39 stocks with a top five holdings of DraftKings, Penn Entertainment, Flutter Entertainment, Tabcorp and Entain.

Street cred: Roundhill CEO Will Hershey told E+M that Morningstar “certainly adds credibility”, in particular as it relates to institutional investors. “Generally speaking, third-party index providers are most common in the ETF wrapper, and a name like Morningstar can help on the distribution front,” he added.

• Hershey said that he “doesn't necessarily envision” additional funds entering the market, noting that the other online gaming ETF – IBET – recently shut down

• “However, over time as we have more and more states enter the market and the US market matures, I could certainly see larger players entering the space.”

• “Of course we would welcome the competition, while noting the first-mover advantage in ETFs is significant.”

By the numbers

Michigan: Online GGR increased 13% to $161m in August with BetMGM continuing to lead with 27% followed by FanDuel (24%) and DraftKings (19%). In sports betting, FanDuel led on 41% while BetMGM led iGaming with 29%.

• FanDuel continued to dominate in sports-betting AGR, grabbing 45% of AGR vs 41% of GGR and 35% of handle.

• In comparison, DraftKings’ and BetMGM’s market shares went in the opposite direction with DraftKings seeing 26% handle share fall to 24% GGR and 22% AGR.

• BetMGM went from 17% handle to 16% GGR and only 13% of AGR.

Pennsylvania: Total GGR grew 7% to $466m in August but sports betting GGR fell 27% percent but was offset by a 35% increase in iCasino. 

• Flip or blip? By market share, there was a flip at the top in OSB NGR terms with DraftKings taking top spot with 33% while FanDuel was second with 25%.

• MoM FanDuel’s NGR dropped 45% from $17.3m to $9.4m while DraftKings fell marginally to $9.5m.

Newslines

Fanatics will launch an online casino this year or early next, and sees iGaming as a priority, Ari Borod, chief business officer, said in a podcast with USBets.

FSB Technology will provide its retail technology stack to UK-based sports-betting technology studio PLYMKR. FSB will also retain an ownership stake in PLYMKR.

** SPONSOR’S MESSAGE **

Are you an iGaming founder or senior executive launching a business in the US?

• We know that building a successful start-up is hard and it’s not easy to do it alone, so we’re here to help.

• The Challenger Series Summit is a unique networking opportunity to learn from US iGaming founders and entrepreneurs, who will be sharing the hacks, tips, and tricks to achieve high growth.

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Calendar

• Sep 21: SBC Summit Barcelona Day 2

• Sep 28: XLMedia

• Oct 8: GeoComply Challenger event, Las Vegas

• Oct 9-12: G2E Las Vegas

• Data scientist – United Kingdom

• Chief marketing officer – United Kingdom

• Mexico country manager – LATAM

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