The news was reported Tuesday by Sky News, which claimed official word would likely be issued Wednesday. According to Sky’s report, the deal would see the Nevada-based Eldorado take a 20% stake in William Hill US, while also receiving “about £50m” in restricted stock in the UK-based parent company. The venture will also involve an online component.
Sky said Hills had been seeking some form of broad-based tie-up with a land-based US casino operator, including Penn National Gaming, but Eldorado apparently proved a better sweet-talker or simply offered Hills the best combination of geographic reach, financial sense and familiarity.
That latter feature comes via the fact that Hills already powers the sportsbooks at Eldorado’s three Reno casinos: the Eldorado, the Silver Legacy and Circus Circus.
Eldorado currently operates 21 venues in 11 states, counting the Grand Victoria Casino in Elgin, Illinois, which the company acquired last month for $327.5m. The company also operates in Colorado, Florida, Iowa, Louisiana, Mississippi, Missouri, Nevada, Ohio, Pennsylvania and West Virginia.
Eldorado dramatically expanded its reach in April via a $1.85b deal with investor Carl Icahn to acquire Tropicana Entertainment, which operates casinos in six states (Indiana, Louisiana, Mississippi, Missouri, New Jersey and Nevada). That deal is expected to close before the year is through.
William Hill US currently has a massive presence in Nevada’s sports betting market, and has expanded this year to operate sportsbooks in Mississippi, West Virginia and New Jersey. The latter market witnessed the launch this weekend of Hills’ first mobile betting product outside Nevada.
Hills’ US division claimed 5% of group revenue in the first half of 2018, reporting betting turnover in Nevada and Delaware up 25% to $660m while revenue rose 50.7% to $31m and adjusted operating profit spiked 156% to $24.3m.
Hills’ H1 figures demonstrated its faith in its US market potential, having splashed out $17.2m to expand its US operations in anticipation of the US Supreme Court’s May ruling that struck down the federal betting prohibition.