Caesars Enters William Hill Bidding Race
September 28, 2020
An announcement confirming the recent tabling of two separate cash proposals saw the bookmaking giant’s value on Friday surge by more than 40 per cent per share. Caesars Entertainment is joined in the takeover race by Apollo Management International, a private equity behemoth also currently in the running to buy U.K. supermarket retail giant Asda, which supermarket chain is owned by Walmart. Other investments by Apollo have included Ladbrokes Coral, MasterChef-making media and television giant Endemol Shine, and even security service supply giant ADT.
The Process So Far
William Hill has in the meantime by way of a stock exchange statement announced that an initial take-over proposal was already received on August 27, 2020, and from Apollo. A further proposal by Apollo was reportedly received soon after, followed by an undisclosed number of counter-proposals by Caesars Entertainment. Whether or not any actual offer for the bookmaker will be made remains a thing of uncertainty, William Hill has said of the written proposals tabled to date. Talks with both potential suitors reportedly remain ongoing.
According to U.K. takeover rules, Apollo and Caesars Entertainment are now required to announce a so-called “firm intention” before close of business on October 23, 2020.
Then Vs Now
First founded as a postal and telephone betting service in the 1930s, a time when gambling was mostly illegal in the U.K., William Hill eventually grew into one of the biggest and best-known names in the betting shop industry when retail betting shops were eventually legalised and regulated in the early 1960s.
But unfortunately for William Hill and so many other U.K. betting shop owners, the easy sailing of the few decades that followed would not last forever. The British retail betting market today isn’t nowhere near what was back then, and as the market grew a tougher cookie to keep on cracking, the bookmaker a couple of years ago had no other option but to set its sights on a budding and now legalised U.S. sports betting market instead.
Caesars No William Hill Stranger
As for Caesars Entertainment and its interest in the William Hill takeover, this is a company already enjoying numerous successful partnership deals alongside the U.K. bookmaking giant. So much so that the two companies have in the past discussed merging some of their operations on the United States. Caesars Entertainment’s own shares rose nearly 7 per cent once the news of its interest in William Hill went public.
William Hill has ever since its former chief digital officer, Ulrik Bengtsson, took over as CEO about a year ago, focussed progressively more on building an online presence. And this is a strategy that served the bookmaker well in recent times following the return of especially horseracing, soccer, and the MLB.
U.S. A Different Ball Game
But despite the move online, the company still remained hard pressed to make some pretty tough decisions regarding its retail betting shops because of the global health crisis. William Hill last month announced that at least one hundred and nineteen of its betting shops would not be reopening.
And it’s a dwindling High Street presence that began receding even before the global crisis hit. The bookmaker already last year closed hundreds of its betting shops after a government ruling saw maximum bets allowable on FOBTs reduced from £100 to only £2.
William Hill’s U.S. scenario, however, paints a completely different picture. With 170 retail outlets in 13 different U.S. states, it is perfectly understandable that the bookmaking giant remains a coveted business takeover target