Rush Street ‘under review, approaches DraftKings’
Rush Street ‘under review, approaches DraftKings’RSI strategic review, MGM Resorts casino sell-off report, Sportradar earnings reaction, Gambling.com M&A, sector watch – esports +More
Who will buy my sweet red roses? RSI strategic reviewThere’s a lot of it about: Rush Street is the latest company to initiate a strategic review and has approached DraftKings among others to sound out a potential sale of the company, according to Bloomberg.
A rush and a push: Rush Street’s shares spiked over 12% on Thursday when the news broke before settling on a 4%+ increase on the day. DraftKings was up over 3%. Rush Street ended the day valued at $1.42bn. 😯 Rush Street spikes on review and DraftKings report Activists on board: Among the notable shareholders at RSI is the hedge fund HG Vora, which owns over 9% of the business, while Canyon Capital Advisors owns a further 7.5% of the company’s shares. By the numbers: In FY23 Rush Street saw revenues climb 17% to $691m for an adj. EBITDA of $8.2m and a net loss of $60.1m. Net losses in Q4 were squeezed to just $5.5m with adj. EBITDA of $11.5m.
Foreign fields: RSI operates in 15 states including five iCasino states plus Ontario. It also has a sizable presence in Colombia and Mexico, which it said in its presentation was a “beachhead” for further expansion in LatAm.
Target on its back: The JMP team also noted RSI has been viewed as a takeout target for several years with a “solid” iCasino market share of 8%, a proprietary technology stack and a “sticky, high-spending customer base.”
Kambi Group is the leading provider of premium sports betting technology and services, empowering operators with all the tools required to deliver world-class sports betting and entertainment experiences. The Group’s services not only include its award-winning turnkey sportsbook but also an increasingly open platform and a range of standalone sports betting services from frontend specialists Shape Games, esports data and odds provider Abios, and AI-powered trading division Tzeract. Together, we are limitless. For more info, go to www.kambi.com +MorePenta Investments is weighing up a potential sale of the central European-focused betting and gaming group Fortuna Entertainment and has hired Morgan Stanley to advise. According to Reuters, a sale could fetch €2bn via an auction process, which will run until the early summer.
Clean bill of health: 888 has announced that the UK Gambling Commission has concluded its license review instigated last summer when FS Gaming investments made an approach about buying the company and installing ex-Entain boss Kenny Alexander as CEO. Hidden danger: Entain overpaid by €68m-€158m for BetCity, according to a UK high court filing, which alleges the founders concealed information about regulatory violations ahead of the sale. Entain bought the operator behind BetCity, BetEnt, for €850m in 2022. Bally’s bidder and major shareholder Standard General has increased its shareholding to 26% from just over 23% previously. Golden Matrix shareholders have approved the proposed acquisition of Meridianbet for $300m. Codere Online has hired Houlihan Lokey and Allen & Overy as its financial and legal advisors to help advise on the LatAm-facing company’s long-term growth plans, according to EGR. Re-up: Social sportsbook startup Rebet has launched a sweepstakes product in 47 states offering what it says is a “revolutionary” sports-betting experience with an app that is “reminiscent” of social media sites.
By the numbersMichigan: Total OSB and iCasino revenue rose 28% in February to just shy of $200m, with OSB up 35% to $30.5m from handle that rose 17% to $403m, while iCasino was up 27% to $129m. FanDuel total share stood at 29%, with BetMGM second on 24% and DraftKings third on 22%. Pennsylvania: B&M casino revenue was up <1% to $279m while iCasino rose 41% to $184.9m in February. OSB revenues were down 16% to $48.3m on handle that rose 13% to $628m. Read acrossIn Compliance+More next week, reaction to the Florida Supreme Court ruling that denies the West Flagler sports-betting challenge. What we’re reading“On Thursday night, an ocean away from Dodger Stadium, Shohei Ohtani did something he had never done in his storied, relentlessly pristine MLB career.” The Ohtani scandal gathers a head of steam. MGM mulls B&M salesLosing my religion: The news that MGM Resorts is thought to be ready to sell its casino interests in Massachusetts and Ohio suggests the company sees little chance of iCasino legislation being imminent in either state, according to sources.
No future: According to Bloomberg, the discussions regarding a potential sale are preliminary, but one industry consultant pointed out that MGM being willing to contemplate selling its B&M presence in each state is indicative of the company seeing “no hope” for iCasino in either.
Downsizing: Sales in Ohio and Massachusetts would leave MGM with a diminished regional footprint, including properties in Mississippi, Maryland, Michigan and a slots facility in New York where it is hoping to win one of the downstate licenses. Li-quids in: Analysts at CBRE suggested the sale of the two properties – which they estimate might bring in ~$533m – could be a capital raise ahead of “larger M&A plans,” an opportunistic trade to unlock value or perhaps part of a larger strategic initiative to improve valuation.
CBRE said this “wouldn’t be as headline-grabbing” as buying BetMGM JV partner Entain but it “could be larger and more impactful than one might think.”
Unmatched iGaming Expertise. In the ever-evolving online gaming landscape, acquire high value casino and sports betting players efficiently. InclineBet's team boasts over 20 years of industry experience to deliver proven UA, CRM, and creative solutions. We specialize in global regulated markets, optimizing your campaigns and delivering results. Gain the edge. Visit our website to learn more. incline.bet Sportradar earnings reviewPing! Sportradar’s shares shot up almost 25% in early trading on Wednesday before settling down to an 11% increase on the day as the market warmed to the better-than-expected Q4 earnings.
On court: Among the highlights spoken about on the earnings call by CEO Carsten Koerl was the successful bid for global ATP rights and the expanded commercial deals for NBA content. He said such deals bring with them “incredible reach and value.”
I feel good: Koerl also noted new product enhancements including 4Sight in tennis streaming, the new emBET watch-and-bet product attached to the NBA Pass OTT offering announced this week and the Alpha Odds solution offered to Sportradar’s managed trading services sportsbook clients. Reddit sports data?Reddit and weep: Reddit could look to monetize sports data as one potential revenue stream. According to Sportico, the IPO prospectus makes mention of the company being in the “early stages of allowing third parties to license access to search, analyze and display historical and real-time data from our platform.”
Gambling.com buys XL assetsRearranging the furniture: The reconstitution of the gaming affiliate sector continued this week as Gambling.com confirmed it was buying a selection of European and Canadian-facing brands, including Freebets.com and WhichBingo.co.uk for $42.5m from fellow affiliate XLMedia.
Peter, meet Paul: The newly North American-focused XLMedia said it would use the proceeds from the deal to pay a final dividend on a previous US acquisition, settle outstanding tax provisions and for working capital purposes for the North American business.
The news came with Gambling.com’s Q4 earnings, which showed net revenue up 52% to $32.5m while adj. EBITDA was up 54% YoY to $10.6m. FY23 revenue rose 42% to $109m with adj. EBITDA coming in up 53% to $36.7m.
Earnings in briefZeal Network: The owner of lottery reseller brand Lotto24 said revenue rose 11% to €116m in 2023 helped by double-digit growth in billings. Adj. EBITDA nudged up to €32.9m despite what the company said was a weak jackpot environment.
Sector watch – EsportsWhy sponsor an event when you can run one? An emerging trend at the intersection of esports and betting is operators running their own esports tournaments, rather than simply sponsoring. Tournaments include: Thunderpick World Championship ($1m prize) Pinnacle Cup V ($50k prize); Rivalry LAN (CA$10k, offline event)
Cheap as chips? Sponsorship for CS:GO’s biggest major is reportedly in the multi-millions and taken by 1xBet, so competing for such sponsorship is unfeasible for most.
HODL: Thunderpick’s 2023 edition attracted peak viewership of 144,317, and had a total prize of $600k, which was all paid in Bitcoin. Ironically, with the recent boom in the price of Bitcoin, the $1m prize on offer in 2024 will be paid in cash to participating teams. Never in sport: Esports is unique in that it offers a chance to create new IP rather than just acquire naming rights or a traditional sports sponsorship. Creation of IP in sports has never been easy – just ask Florentino Pérez and the Super League rabble.
Roster: Meanwhile, Kambi has announced it will offer eSoccer odds on its sportsbook platform through its eSports subsidiary Abios. Kambi also plans to add odds for eBasketball, Counter-Strike and League of Legends from Abios this year. Calendar
White Paper worries? Join Rank Group plc and other leading operators in getting a head start on the coming era of additional checks from the sector experts. Book your demo today at https://dotrust.co.uk Offices in London and Gibraltar. FCA, ICO registered. ISO27001 certified. An +More Media publication. For sponsorship inquiries email scott@andmore.media. |
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