iGaming Weekly Wrap-Up #17
#Breaking News
1.??????UKGC: National Lottery good causes funds fall 11% in latest quarter
The UK Gambling Commission (UKGC) has revealed that the National Lottery’s Good Causes funding in Q4 fell in comparison to the previous quarter and last year.
Publishing an update on its website, the Commission showed that the total raised for good causes in Q4 (January-March 2022), was ￡491.3 million.
This represented a decline of 3.4% from the previous quarter and 10.9% in the fourth quarter of 2020/21, a drop of ￡17.2 million and ￡60 million respectively.
Q4 2020/21 saw ￡551.3 million contributed in good causes funding, whilst in Q3 2021/22 a total of ￡508.5 million – when the additional three quarters are factored in, ￡2.4 billion was contributed to good causes.
The declines in quarterly good cause funding has been attributed by the UKGC to a 0.8% decline in total National Lottery sales to ￡17.2 million in comparison to the previous quarter.
Additionally, EuroMillions sales fell by ￡122.8 million, a decline of 22.4%, largely due to ‘comparatively fewer rollovers occurring the most recent period’ according to the UKGC, although there was an increase across all other games.
Lastly, total unclaimed prizes added as returns to good causes stood at ‘around ￡10 million less’ in Q4 2021/22 than in the previous quarter, which the Commission stated was due to a ‘particularly high’ volume of scratchcard game closures during Q3 2021/22.
2.??????California Sports Betting Proponents Get 1.6M Signatures for Ballot Measure
Proponents of a measure that would legalize online sports betting in California announced Tuesday they gathered 1.6 million signatures to get the question on the ballot this year.
The Golden Gate Bridge at night in San Francisco. Proponents of a measure that would allow mobile sports betting in the state say they got 1.6 million signatures on a petition to put the question on the November ballot. (Image: Carol M. Highsmith/Library of Congress)
Election officials need to verify that 997,139 came from registered voters by June 30 in order for voters to decide on the measure in the November general election, according to the California Secretary of State’s office.
Should that happen, it would likely be the second sports betting question to go before voters on the ballot. That would set up what will be a hotly contested and expensive battle between national operators of online sportsbooks and California tribal casinos, the latter pushing for in-person sportsbooks at their casinos and state-licensed racetracks.
The online sportsbooks are behind “Californians for Solutions to Homelessness and Mental Health Support.” It’s a $100 million campaign led by FanDuel and DraftKings and other major national sportsbook operators. The measure was announced in late August and was approved to circulate petitions last fall. Tuesday was the deadline for the group to turn in petitions for verification.
3.??????Hooters partners with DraftKings to attract sports bettors
Hooters of America is aiming to warm up the growing sports wagering market across the US, having secured one partnership with DraftKings and another with PointsBet soon to follow.
The Hooters trademark is a brand name shared by two restaurant chains; Hooters is based in Florida, while Hooters of America is headquartered in Georgia and owned by Nord Bay Capital.
Hooters of America is the larger of the two networks, spanning 37 states with 379 restaurants, of which approximately half are franchise-operated.?
With an increasing number of US states legalising sports betting since the Supreme Court ruling in 2018, the restaurant chain is looking to boost its appeal by partnering with operators, such as DraftKings.
Guests can now scan a QR code in one of Hooters’ restaurants to receive special offers with DraftKings. A similar deal with another sportsbook operator, PointsBet, is said to be close to being finalised.
Hooters of America CEO Sam Melilli commented: “We’re seeing there’s a strong demand for the legalisation of gambling. We’ve been in it from the beginning and we’re in tune with that. Many of our guests come to us for two reasons: our world-famous wings and as a destination to watch sports events.
4.??????MGM makes $607M bid to buy LeoVegas eyeing online gaming segment global expansion
Casino and hospitality giant MGM Resorts International has announced an offer to acquire online gaming operator LeoVegas. The Nevada-based heavyweight has commenced a public tender offer for 100% of the shares of the Swedish business at a price of SEK 61.00 in cash per share, equivalent to a total tender value of approximately $607 million.
The acquisition is set to advance MGM Resort’s strategy for the digital gaming segment, expanding it internationally. The transaction will be financed with existing cash and is expected to be accretive to MGM Resorts’ earnings and cash flow per share.
"Our vision is to be the world's premier gaming entertainment company, and this strategic opportunity with LeoVegas will allow us to continue to grow our reach throughout the world," said MGM Resorts' CEO & President Bill Hornbuckle. "We have achieved remarkable success with BetMGM in the U.S., and with the acquisition of LeoVegas in Europe we will expand our online gaming presence globally.”
?#US / Canada
5.??????Flutter stands firm on 2023 US profitability deadline as FanDuel smashes Q1 records
FanDuel delivered a record quarter for Flutter Entertainment in Q1 2022 as US revenue climbed by 45% year-on-year to $574m.
The all-time high was achieved despite significant customer friendly results across February and into March Madness, which cost the operator a further $130m in revenue according to Flutter CEO Peter Jackson.
FanDuel acquired more than 1.3 million customers in Q1, which represents over 70% of its entire customer acquisition volume during the entirety of full-year 2021.
“The strength of the customer economics we’re seeing continues to give us conviction of our path to 2023 profitability,” said Jackson, who pointed out a cumulative cost-per-acquisition of $290, resulting in “very strong” average paybacks within 12 to 18 months.
The 45% revenue uptick was driven by 43% growth in average monthly players (AMPs) as handle more than doubled year-on-year to $7.7bn.
During Q1, FanDuel claimed 37% market share for online sports betting as sportsbook revenue jumped by 89%, despite reportedly losing out on $132m due to customer-friendly results.
FanDuel’s Q1 market share percentage for iGaming stood at 20%, with growth in the vertical driven by sports cross-sell during March Madness and the iGaming launch in Connecticut.
6.??????Arizona sports betting revenue drops to $24.4m in February
Sports betting handle in Arizona fell 12.8% month-on-month to $491.7m (￡391.6m/€463.3m) in February, while gross revenue was also down 39.8%.
The state’s handle for the month was some way behind the record $563.7m set in January of this year, with $488.3m being wagered online and the remaining $3.4m at retail sports betting facilities.
Players won a total of $466.0m, which left $24.4m in gross revenue before free bets, down from $40.5m in January.
After accounting for $17.6m worth of free bets and promotional credits issued in the month, this left $6.9m in taxable revenue, down 64.8% month-on-month. The state was also able to collect $670,686 in tax from sports betting in January.
Looking at individual operator performances, FanDuel claimed top spot in terms of wagers processed, taking $142.5m in bets during February. DraftKings placed second with $131.7m, then BetMGM on $99.8m.
7.??????Virginia players wager $469.5m on sports in March
Bettors in Virginia wagered $469.5m (￡375.4m/€447.0m) on sports during March, the second highest monthly total since the state launched its regulated betting market.
The March handle was 54.4% higher than $304.1m in the same month last year and 16.9% up from $401.9m in February of this year, while it fell 3.2% short of the record $485.5m set in January 2022.
The Virginia Lottery said the year-on-year and month-on-month increase in player spending was helped by betting on the NCAA college basketball tournament that ran throughout the month.
Adjusted gross gaming revenue, defined as total bets minus total winnings, bouses and promotions and other authorised deductions, also increased 3.6% from $13.8m in March 2021 to $14.3m and 81.0% from $7.9m in February this year.
Players won a total of $435.8m from sports betting during the month while $14.1m worth of bonuses and promotions were issued to players.
8.??????Ontario Sports Betting Fines Levied On BetMGM, PointsBet
A month into commercial Ontario sports betting, regulators have issued the first fines to sportsbook operators for breaking the province’s strict advertising rules.
The Alcohol and Gaming Commission of Ontario served BetMGM and PointsBet with fines for breaching the agency’s Registrar’s Standards For Internet Gaming, according to an AGCO release Tuesday. The infractions are related to restrictions on advertising for Ontario sports betting.
“The AGCO holds all registered operators to high standards of responsible gambling, player protection and game integrity, and monitors their activities to ensure they are meeting their obligations under Ontario’s Gaming Control Act and the Standards,” AGCO CEO and Registrar Tom Mungham said in the release.
Ontario sports betting advertising restrictions
Ontario regulations include a broad prohibition of advertising for bonuses and other incentives to the general public.
Operators can include them on their website, or through direct advertising and marketing after an individual player’s consent. The operators can appeal the regulator’s penalties.
BetMGM’s infractions came via Twitter, while PointsBet’s were in advertising on the GO Transit system.
9.??????Chicago selects Bally’s to operate $1.7bn casino
The City Council of Chicago has selected Bally’s to build a $1.7bn casino resort in the city’s downtown area.
Bally’s Chicago was chosen as the preferred bidder following a request for proposals process. Other finalists had included Rush Street Gaming and Hard Rock, while other bids from Bally’s and Rush Street focused on other locations were eliminated at an earlier stage.
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In its bid, Bally’s outlined that it will pay $40m to the City up front, plus annual payments of $4m. bally’s A total of 3,000 staff will be employed in construction of the resort, with a further 3,000 permanent jobs when it is complete.
The casino will be located on the 30-acre Chicago Tribune Publishing Center at the intersection of Chicago Avenue and Halstead Street.
As part of Bally’s Community Investment Program, 25% of the equity in Bally’s Chicago will be reserved for a matched financing scheme that will allow local communities of investors to own a stake in the project.
#M&A & Finance
10.??Aspire Global revenue climbs to €46m as momentum maintained on B2B refocus
Aspire Global has maintained ‘continued strong business momentum’ in the first quarter of 2022 according to CEO Tshashi Maimon, as the group prepares to move forward with its €410 million merger with NeoGames.
The international B2B gambling group recorded an increase in Q1 revenues of 31.7% to €46.3 million (Q1 2021: €35.2m), along with a rise in EBITDA of 18.7 % to €8.2 million (€6.9m), amounting to an slightly lower EBITDA margin of?17.8% (19.7%).
Meanwhile, EBIT stood at €5.6 million (€4.9m), an increase of 13.6%, whilst earnings after tax rose by 4.7% to €4.8 million (€4.5m) and earnings per share remained the same as the corresponding quarter the previous year at €0.10.
The trading update marks Aspire Global’s second quarter as a solely B2B focused business, following the divestment of its B2C units to Esports Technologies in October 2021 for a total consideration of $75.9 million.
Having streamlined its operations as a B2B business, Aspire has secured growth across multiple European and North American markets, notably securing a licence for its full offering in the Netherlands and inking a deal between its BtoBet brand – which recorded a revenue increase of 88.3% during the quarter – and BoyleSports in the country.
Additional European developments have seen BtoBet expand its presence in the Danish sports betting market and in Germany deals have been struck with ITSP and in the esports space with WIN Group, whilst in North America Pariplay has linked with Golden Nugget and Alberta Gaming, and gained licences in Ontario and Michigan and a GLI-19 certification in the US and Canada.
11.??DraftKings seals GNOG acquisition and looks to $300m of synergies including live dealer suite
DraftKings has completed the all-stock acquisition of Golden Nugget Online Gaming (GNOG), nearly nine months after the initial agreement was announced in August of 2021.
At that time, DraftKings stock was trading at $52 per share, which valued the transaction at $1.5bn. Since then, DraftKings’ share price has dropped like a stone.
It closed at $15.73 yesterday (4 May), meaning the total compensation for GNOG shareholders is now closer to $365m.
DraftKings eventually expects to deliver $300m worth of synergies resulting from the purchase, which will also substantially strengthen its iGaming online casino offering.
These synergies will be achieved by cross-sell between both businesses and verticals, as well as marketing efficiencies and reduced platform costs. GNOG will be migrated onto DraftKings’ proprietary technology platform in due course.
The company said in a statement: “DraftKings expects revenue to increase from additional cross-promotion opportunities, which would be expected to complementarily grow DraftKings’ customer base by engaging existing Golden Nugget Online Gaming’s iGaming-first customers.
“Additional anticipated revenue synergies include potential technology and game expansion, such as live dealer offerings.”
GNOG was the first company to launch a live dealer studio in the US, according to its investor relations website.
12.??Caesars Shopping Flamingo Las Vegas for North of $1 Billion
Caesars Entertainment’s (NASDAQ:CZR) long-running plans to divest one of its Las Vegas Strip venues may be coming to life as the operator is said to be shopping the Flamingo at a price tag of more than $1 billion.
It’s been no secret that Caesars is looking to offload one of its Sin City assets to reduce debt, which stood at $13.5 billion at the end of the first quarter. When Eldorado Resorts acquired “old Caesars” in 2020 Tom Reeg — then chief executive officer of the buyer — made clear “new Caesars” would sell one of its Strip properties to tame one of the gaming industry’s largest debt burdens.
Since then, the only debates centered around when the operator would formally announce an asset sale and which Las Vegas venue it would be. At least one analyst says it’s going to be the Flamingo that Caesars sells.
We continue to believe CZR is likely to sell the Flamingo,” said Deutsche Bank analyst Carlo Santarelli in a note to clients. “While investors focus primarily on the deleverage associated with the asset sale, we see the transaction as favorable for room night mix/ADR compression/margins.”
He believes it’s possible a deal is reached in the third quarter.
13.??888 shareholders to vote on WIlliam Hill acquisition on 16 May
888 shareholders are set to vote on 16 May to approve the business’ acquisition of William Hill’s non-US assets from Caesars.
As the William Hill assets are larger than the current 888 business, the merger – agreed in September 2021 – is considered a reverse takeover, and so must be approved by shareholders of 888. In a prospectus to shareholders, 888’s board outlined why it backed the deal, and provided more information about both William Hill and the effect of the Gambling Act review on the combined business.
Shareholders will meet at 10:00 am on 16 May in London to consider the deal. Those who cannot attend in person may apply for a proxy vote by 11 May.
The prospectus comes less than a month after 888 and Caesars agreed to reduce the purchase price to acquire the assets by ￡250m (€297.9m/$315.0m), with the cash portion of the deal now set at ￡584.9m instead of ￡834.9m.
#Legal:
14.??Uzbekistan withdraws support for sportsbook legalisation
Further troubles loom in the CIS region as Shavkat Mirziyoyev, President of Uzbekistan, has withdrawn his support for a decree to establish a national framework legalising betting activities.??
Last week, local media reported that Mirziyoyev would no longer back plans for Uzbekistan to launch its first legislative framework establishing federal laws for ‘sportsbook and sweepstake’ services.
Back in December 2019, Mirziyoyev – the leader of O’ZLIDEP, Uzbekistan’s Liberal Party – announced that he would support his party’s pledge to legalise sports betting and sweepstakes under strict government controls.
In the decision, Mirziyoyev and O’ZLIDEP deputies had consulted figureheads of the Muslim community, which accounts for 88% of Uzbekistan’s population.
Initial plans were to directly tie sports betting and sweepstake tax revenues with the development of Uzbekistan’s professional football league, as the O’ZLIDEP party had set the bold ambition for the country to qualify for its first FIFA World Cup since gaining independence from the Soviet Union in 1991.
Though never formally published, the O’ZLIDEP party is reported to have drafted plans to create ‘licensed betting zones’ in the Northern city of Muynak that would allow for customers to access betting shops within designated resorts and shopping malls.
Two years following its draft approval, hopes of Uzbekistan launching its sports betting framework had dwindled as the government failed to meet the 1 January 2022 launch deadline.
15.??German Sportsbooks Partner against Hesse in One Massive Lawsuit
All 33 German licensed sportsbooks have teamed up in a joint lawsuit against the State of Hesse. The reason why the operators decided to sue Hesse is the strict market regulations and as critics state, operators based in Germany have a clear disadvantage over offshore companies.
The German Sports Betting Association Thinks That Players Will Be Pushed to the Black Market
Hesse, the defendant in the case, will be represented by the Regional Council of Darmstadt. A spokesperson of the council confirmed the news as he said that both land-based and online licensed sports betting operators in Germany have filed lawsuits.
On July 1, the Third State Treaty on Gambling allowed online operators to offer their services in Germany. Up until that point, the only form of legal online wagering was sports betting. With the new regulatory framework, slots and poker games were allowed. Most recently, North Rhine-Westphalia, Germany’s largest state, approved iGaming.
However, operators continued to face a lot of restrictions. One of the strictest restrictions concerns in-play betting as German punters can only bet on the match winner and number of goals. That is why the German Sports Betting Association (DSWV) was vocal about these restrictions. The association stated that the restrictions are more than likely to push players to the black market.
16.??Swedish court upholds penalties against ComeOn brands
The Link?ping Administrative Court has maintained three fines and reduced a fourth in an appeal launched by online gaming operator ComeOn. The operator received four fines from the gaming regulator Spelinspektionen for breaching Sweden’s bonus rules, while restrict operators to offering bonuses on signup only.
Spelinspektionen had fined ComeOn’s Casinostugan SEK25m (€2.49m) fee, ComeOn Sweden SEK35m penalty fee, Hajper Ltd SEK50m and Snabbare Ltd SEK65m for offering bonuses to players who already had accounts.
Casinstugan had given an example player SEK21,000 in bonuses along with free spins and ComeOn gave a sample player SEK40,000 in bonuses. Hajper gave one player SEK7,400 in bonuses plus free bets and another SEK13,500 and free spins. Snabbare, which received the largest fine, gave a customer SEK6,950 in bonues and gave free spins to another.
The Administrative Court maintained three of the four fines at their original levels, only reducing that issued to Hajper. It reduced the fine from SEK50m to SEK40m
17.??KSA warns operators over “insufficient” AML compliance
Dutch regulator de Kansspelautoriteit (KSA) has warned online gambling licensees after noting some were “insufficiently” complying with obligations in the country’s Money Laundering and Terrorist Financing (Prevention) Act (Wwft).
Licensees in the Netherlands are required to adhere to regulations set out in the Wwft, but an investigation by KSA and data from the Financial Intelligence Unit (FIU-the Netherlands) found certain rules were not being properly followed.
Setting out its findings, the KSA said some operators were failing to check customers’ origin of money, saying many licensees only saw a reason to carry out these checks when players make a deposit in excess of €2,500 (￡2,097/$2,627).
However, the KSA made the point that spending this amount of money on games of chance is only possible for a few people noting how the average net monthly salary in the country is approximately €2,500.
CEO hinterzimmer.io RGS & H?lle Games
2 年I think you need to expand the iGamingNext weekly from 1h to like a full day podcast.