To buy or not to buy, that is the question
To buy or not to buy, that is the questionM&A outlook, Bally’s tumble, analyst takes, startup focus – Lucra Sports +More
Who will tie it up with a ribbon and put it in a box for me? M&A outlookAnalysts mull a mixed picture for M&A activity in 2024. Burning a hole: Expectations remain high that there will be significant M&A activity in the year ahead. “As the market leaders pivot to profitability, history tells us that the resulting excess cash is likely to be deployed to support inorganic growth,” said the Citizens Bank 2024 preview. To build a home: But the team at JMP cautioned that in OSB the market leaders were well capitalized enough to “build not buy.” More likely, the team suggested, was a move to augment iCasino capabilities.
Kings of the wild frontier: Speaking of which, the team at EKG have predicted DraftKings will once again enter the M&A arena this year. “DraftKings has long had designs on leveraging its US sports expertise in nearby markets,” they wrote.
Broadened horizons: Similarly, JMP also argued that US companies will be seeking out M&A in international markets, but they put MGM in the frame as being likely to want to acquire an international sportsbook to complement its LeoVegas operation.
B2B2M&A: Truist noted that a variety of B2B names – including AGS, Everi and Inspired – are currently trading at around 5x EBITDA. “If sustained, this could lead to more consolidation/M&A – especially if capital markets improve,” the team argued.
Finally, in the affiliate space the Truist team indicated M&A will be the focus at Gambling.com, suggesting it will likely try to “expand its reach in media as the fragmented sector further consolidates.” Further reading: In tomorrow’s edition of Deal Talk we discuss the situation surrounding Entain. Bull/bear debateAfter hosting an open forum made up of 30 institutional investors in the gaming space, the team at Deutsche Bank reported that, among the key debating issues, many within the group believed bet365 would be the disruptor to watch this year.
Sportsbook operators & providers - Are you looking to up your risk management & trading game in 2024? Set a meeting with Matchbook at ICE 2024 February 6th-8th to discuss any of the following:
Matchbook B2B - Because the best price is for everyone. Visit http://www.matchbook.com/promo/b2b or get in touch at b2b@matchbook.com +MoreThe week aheadFlutter will provide the headlines later this week as it provides a trading statement on Thursday. This will be the last statement before it officially attains dual-listing status on Jan. 29.
Earlier in the week, 888 will release its first trading statement under the stewardship of new-ish CEO Per Widerström. Recall, Peel Hunt analysts said recently they expect him to steady the ship while extracting the ”original potential” from the William Hill buyout. By the numbersIndiana: In terms of AGR, FanDuel grabbed 41% share in December followed by DraftKings on 38%, while ESPN Bet headed the rest of the market on 9%, with BetMGM on 7% and Caesars on 6%. What we’re readingHomebodies: “I know how much poorer this city would be without bet365.” The FT. Career pathsRaketech: Oskar Mühlbach is to step down from his position as CEO, citing differing views on the company’s strategic direction. Co-founder Johan Svensson will act as interim CEO. UK Betting and Gaming Council: CEO Michael Dugher will assume the role of chair when Brigid Simmonds steps down from the role on April 21. The role of CEO will remain vacant until a replacement is found. Caroline Ackroyd has resigned as CFO of XL Media, effective March 31. She plans to join another operator in the gaming sector. Fitzdares has hired Nick Dutton as its new COO. Bragg Gaming has appointed Simon Dudnjik as chief human resources officer. He joins from Sportradar. Bally’s bad weekWinds of change: Gamesys’ £6m UK Gambling Commission fine grabbed the headlines last week, but it is perhaps fears over the viability of Bally’s permanent casino in Chicago that is driving the poor share price performance, down over 10% last week.
🚽 Bally’s down over 10% in a week Analyst takesCaesars: Those who doubt roll-up strategies can work like a charm need only look at Caesars. In its 10 years as a public company – first as Eldorado, then as Caesars when it bought the firm in 2020 – it has increased revenue by 32x.
Gaming & Leisure Properties: After meetings with management, the team at Truist were positive on the company’s visible deal pipeline, suggesting the flexible balance sheet was advantageous with potential rate improvements.
ICE London 2024 will be MEGA with Soft2Bet! We look forward to showcasing our Motivational Engineering Gaming Application (MEGA), the best gamification package in the iGaming industry. We also invite partners and delegates to visit our brand new stand, where our senior leaders will be hosting workshops that will highlight our state-of-the-art technology, platform and services and of course MEGA. See you at Stand S6-210! https://www.soft2bet.com/news/soft2bets-mega-is-coming-to-ice-london Startup focus – Lucra SportsWorth a Luc: The company’s two founders Dylan Robbins, CEO, and Michael Madding, COO, met 10 years ago when they both worked at Goldman Sachs. They spent their free time together watching and playing sports, keeping a running note on their phones of their friendly side bets.
So, in 2019, they started Lucra, which now employs 15 people remotely across the US.
Lucrative: In Mar22, they raised $10m via a Series A, led by Raptor Group, SeventySix Capital and Victress Capital, as well as Milwaukee Bucks owner Marc Lasry, professional tennis player John Isner and NFL Pro Bowl wide receiver Emmanuel Sanders. Luc out: “There is a unique market opportunity in the B2B software space within the wagering ecosystem,” Madding claims. With the “intense focus” from the market leaders on D2C, it “leaves an open door for Lucra to differentiate itself from the competition.”
Luc to the future: Revenue last year increased 5x to $500k and the company is “on pace to 10x it this year, and do $5m-10m in run-rate revenue this year (with $2m closed in Q1 2024).”
Growth company newsAcing it: The TennisONE app has added real-money contests to its offering in time for the 2024 Australian Open, which got underway yesterday. Thanks to a new partnership with Lucra (see above), fans will be able to bet against each other without the need for a bookie.
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Older messages
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