iGaming Wrap-Up of CW 33-34 2024
#iGaming News of the week
0.?????? Why is DraftKings being sued by NFL Players Association?
The NFL Players Association is suing DraftKings over an anticipated breach of contract that could relate to the sportsbook’s shuttered NFT product.
The lawsuit was filed Tuesday in the Southern District Court of New York. Specifics about the case are unavailable, though, as the filings are sealed.
A cover sheet for the filing states the NFLPA is seeking damages for an “anticipated breach of parties’ contract” or an actual breach by DraftKings.
The NFLPA is owed nearly $32.4 million dollars by OneTeam Partners, according to its 2023 annual report. OneTeam Partners is “the commercial rights holder and arm of 8 Players Associations and tens of thousands of college athletes,” the company says on its website. The NFLPA was one of the founding partners. OneTeam facilitated the initial deal with the NFLPA and DraftKings.
Neither DraftKings nor the NFLPA responded to requests for comment at the time of publication.
#Breaking News
1.?????? Better Collective pledges H2 EBITDA recovery & US profit comeback
Better Collective A/S maintains confidence in achieving its upgraded full-year financial objectives, despite reporting flat EBITDA results during Q2 trading.
Publishing its Interim H1 2024 accounts, the Stockholm and Copenhagen joint-listed iGaming media group’s year-to-date revenues stand at €194m, up 17% on 2023 YTD comparatives of €166m.
Revenue growth was maintained by Better Collective, generating a 27% increase in Q2 income to €99m (Q2 2023: €78m), with leadership underscoring a contribution of €62m from recurring revenue streams.
CEO and Co-Founder Jesper S?gaard commented on Q2 results: “Our existing business is back to organic growth despite the exceptionally good performance during the first half of 2023. On the back of that, we have delivered a considerable increase in recurring revenue stemming from both organic and acquired growth, while continuing our North American transition to revenue share.”
2.?????? Tappeiner takes charge of Wynn’s UAE resort
Wynn Resorts has appointed Max Tappeiner as president of Wynn Al Marjan Island, the operator’s United Arab Emirates resort currently under development.
Tappeiner takes on the role from 1 September this year after two years at Wynn Las Vegas. He joined as senior vice-president of operations, before a promotion to executive vice-president in May 2023.
Previously Tappeiner held operations roles at other Las Vegas Strip properties including Resorts World Las Vegas and The Venetian and Palazzo, where he served as vice-president of hotel operations. This followed years in the hotel industry mainly with Mandarin Oriental Hotel Group.
“I’m beyond grateful and humbled to join the Wynn Al Marjan Island team,” Tappeiner wrote on LinkedIn. “Thank you to Craig Billings for this amazing opportunity.
3.?????? KSA orders F1 to remove Stake.com branding from Dutch GP
Ahead of the Dutch F1 Grand Prix this Sunday (25 August), Kansspelautoriteit (KSA), the Netherlands Gambling Authority has ordered organiser Formula One to remove all advertising promoting Stake.com.
KSA commands F1 to remove all advertising related to Stake.com, due to the online casino and sports betting brand having no licence to operate in the Netherlands. As such the presence of Stake.com, will infringe on the advertising laws of the Netherlands Remote Gambling Act (KOA).
The decision is significant since Stake recently became the title sponsor of the Sauber Motorsports team, now known as the ‘Stake F1 Team.’ As a result, Stake.com’s branding must be removed from the team’s cars and any other materials for the race in Zandvoort this weekend.
In the Netherlands, gambling legislation prohibits any betting or gaming company from offering games of chance without a license or promoting such activities.
4.?????? Bet365 named first sports betting partner of the Champions League
Bet365 has become the first official sports betting partner of the UEFA Champions League (UCL) in a three-year deal.
Covering the men’s competition, the move will see the UK operator gain significant brand exposure on in-game perimeter LED boards, media backdrops, as well as UEFA Champions League digital channels.
Alex Sefton, bet365 Global Chief Marketing Officer, commented: “As the first sports betting brand to sponsor the UEFA Champions League, we’re delighted to be joining a roster of high-profile premier brand partners at such an exciting time for the competition. bet365 has a long and successful football heritage and this prestigious partnership reflects our commitment to giving fans ‘Never Ordinary’ experiences.”
The partnership will be launched with what the pair described as “one of the largest ticket giveaways in the competition’s history”, giving fans the opportunity to access ‘extremely sought-after’ seats. The deal is set to last until the end of the 2026/27 season.
5.?????? Japanese police launches investigation into illegal offshore gambling
Japan’s National Police Agency (NPA) will begin its first investigation into offshore gambling websites, which are said to have proliferated among the youth of Japan’s society.
The NPA will investigate operators of online casinos targeting Japanese people. It will identify the locations of said operators, monetary transaction processes and trails, plus the number of visits to sites from Japan.
The agency will also conduct a survey with more than 7,000 people in Japan, ranging from teenagers to elderly in their 70s. A report will be compiled on online casino use by the end of the year.
While certain forms of gambling were allowed in Japan, online gambling remains illegal, even if the operators/service providers were legal operations offshore. It is a widespread misconception that gambling sites operating legally outside of Japan are legal for use in Japan.
6.?????? Caesars activist Carl Icahn settles SEC charges for disclosure failures
Caesars activist investor Carl Icahn agreed yesterday (19 August) to settle charges with the US security markets over his failure to disclose the use of company securities as collateral for personal loans.?
The billionaire activist investor and his company, Icahn Enterprises LP (IEP), agreed to pay civil penalties of $1.5m and $500,000, respectively, to settle the SEC charges.
This settlement follows Icahn’s recent accumulation of a significant stake in Caesars, news of which led to a 16% bump in the company’s share price in May.
Icahn previously played an important role in driving Caesars’ $17.3bn cash and stock merger with Eldorado Resorts in 2020.
7.?????? Betting Hero sold to co-founders and GeoComply for $37M
Betting Hero announced on Thursday the completion of the sale of the business to Hero Group Corp., a new entity controlled by co-founders Jai Maw and Jeremy Jakary with financial support from GeoComply. In June, sports and entertainment company FansUnite announced the sale of Betting Hero to its co-owners and GeoComply for $37.5 million.
Before the sale, Betting Hero had served as FansUnite’s wholly-owned U.S. subsidiary. After the closing of the transaction, Jakary and Maw jointly own 60% of Betting Hero while GeoComply holds the remaining 40% stake. GeoComply’s investment will support scaling.
“We are really excited to work with GeoComply across the entirety of their business and ours,” Maw told SBC Americas. “They are a company that prioritizes the needs of their clients and are on a mission to help operators improve the industry for all. At Betting Hero, we share a similar vision and mission.”
#US / Canada
8.?????? Nebraska online sports betting bill stalls as legislative session ends
Efforts to legalize online sports betting in Nebraska faced another setback as the state’s special legislative session adjourned without addressing the issue, postponing the debate until January.
The 17-day special session, which concluded sine die on Tuesday, focused primarily on property tax relief and left the fate of two sports betting bills introduced by Senator Eliot Bostar, LR 3CA and LB 13, unresolved. The bills aimed to legalize online sports betting but did not make it to the floor for discussion.
Hopes for advancing the legislation faded as the special session went on. Besides, a group of 13 senators referred to the proposed sports betting legalization as "a poison pill," presenting a major hurdle for the initiative.
9.?????? AGA calls for sweepstakes based gaming crackdown
The US gaming trade body called on gaming regulators and state attorney generals to investigate companies offering gaming under the “sweepstakes” model to ensure their compliance with the law.
This call to action follows the rise of many businesses using state sweepstakes laws to offer iGaming and sportsbook-style games to consumers.
The trade body urged state legislatures to consider passing new laws to prevent sweepstakes-based operators from offering effective real-money gaming.
Due to the lack of regulatory oversight, the AGA argued, current sweepstakes-based platforms present risks to the consumer and challenge the economic integrity of the legal market.
10.?? NV regulators accuse Resorts World of major AML failings
The Nevada Gaming Control Board (NGCB) filed a disciplinary complaint on Thursday against Resorts World Las Vegas and its parent and affiliated companies as well as individuals working for the property.
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The NGCB alleges Resorts World fostered an operational environment that lacked oversight as an entertainment destination with suspected or direct ties to illegal gambling businesses. The alleged lack of compliance led Resorts World to not meet the standards of its Anti-Money Laundering (AML) Program by allowing individuals to wager money siphoned through illegal gambling operations. The probe, which focuses on the conduct of bookie Matthew Bowyer, Bowyer made headlines earlier this year when he was charged with operating an illegal sports betting ring with clients including Shohei Ohtani’s ex-interpreter Ippei Mizuhara.
Bowyer submitted a $5,000 credit application to Resorts World in 2021 that was later converted to a $1 million front-money application. The 49-year-old was allowed to wager at Resorts World in 2022 after making a $1 million front-money deposit despite the casino not establishing a source of funds after receiving his application.
11.?? Lottery.com accused of fraudulent misrepresentation in lawsuit
Lottery.com and its CEO have been accused of fraudulent misrepresentation in a lawsuit involving a Florida supply chain business, according to legal documents obtained by NEXT.io.
The troubled lottery brokerage and its CEO Matthew McGahan face accusations in Florida District Court that they created a letter promising shares in return for investment, despite knowing the letter was false.
The lawsuit is just the latest legal action filed against Lottery.com, which has faced multiple scandals after dramatically imploding in summer 2022.
Lottery.com’s lawyers said: “First, the Letter is not a complete contract, because the Letter is ‘in accordance with’ separate ‘agreed terms and conditions. Plaintiffs could not be reasonably relying on terms they did not know. The Letter was at most the equivalent of a piece of a Map and could not be material by itself.”
12.?? DC betting handle up 250% YoY thanks to competitive marketplace
D.C.’s overall online sports betting handle was up 254.1% year over year in July as the district opened up to multiple commercial operators for the first time.
Until July 17, FanDuel was the sole provider of online sports betting across the district through its partnership with the D.C. Lottery. By the end of July, it had been joined by BetMGM, Caesars and DraftKings in offering online wagering D.C.-wide.
Overall, D.C.’s mobile sportsbooks collectively took $27.3 million in bets and made a total of $3.9 million in revenue in July. Those numbers were down slightly from June but up 254.1% and 176.2%, respectively, from July 2023, back when the much-maligned GambetDC was the sole provider. Year to date, D.C.’s online sports betting handle of $162.8 million is up 65.4% compared to January to July 2023.
13.?? Michigan generates $220.9m in July iGaming and sports wagering revenue
The Michigan Gaming Control Board has announced that its commercial and tribal iGaming and sports betting operators generated $220.86m of revenue in the month of July.?
Gross receipts rose by 3.2% when compared to figures from June, with Michigan’s total iGaming revenue for the month of July settling at $191.44m. Further, gross sports betting receipts in Michigan totaled $29.42m for the month, with total sports betting handle decreasing by 9.6% when compared to figures from June to $250.2m.?
Michigan’s combined iGaming and sports wagering total adjusted gross receipts (AGR) for July 2024 reached $189.5m – with iGaming AGR rising by 4.7% when compared to June’s figures. Additionally, iGaming and sports betting AGR increased by 24.7% and 5.2% respectively compared the figures recorded in July 2023.?
14.?? Pennsylvania July gaming revenue rises 7, reaching $500.8m
The Pennsylvania Gaming Control Board (PGCB) has released revenue figures for gaming in the state in the month of July.
In total revenue from all forms of gaming, including iGaming, retail, fantasy contests, etc, reached $500.8m, representing an increase of 7.22% year-over-year.
While Hollywood Casino at Penn National Race Course brought in the largest proportion of total revenue at $79.5m, its growth of 13.44% wasn’t the largest, with Bally’s Pennsylvania seeing its revenue rise 141.31% to $3.48m.
15.?? New Jersey gaming revenue reaches $547.8m in July 2024
New Jersey's casinos, racetracks, and online partners saw an 8.2% rise in total gaming revenue in July compared to the same period last year, despite a continued dip in in-person casino winnings, according to figures released on Friday by the state Division of Gaming Enforcement.
The total gaming revenue for July reached $547.8 million, marking the highest revenue for the month in over a decade, driven by near-record internet gaming wins and robust sports wagering figures.
“The diversity of gaming options and the strength of New Jersey’s online casinos continue to provide resilience in a highly competitive marketplace — not only for the benefit of the gaming industry, but also for the economy of the city, the region, and the state,” said James Plousis, chairman of the New Jersey Casino Control Commission.
#M&A & Finance
16.?? Golden Matrix acquires $8.4m majority stake in discounts platform
Golden Matrix acquired an 80% stake in Australian online discounts platform Classics for a Cause (CFAC) for $8.4m.
The Nasdaq-listed B2B and B2C business highlighted the strategic acquisition as marking its entrance into the customer loyalty and rewards industry. It follows Golden Matrix’s 2021 80% acquisition of UK-based competitions brand RKings Competitions, with the remaining stake purchased November 2022.
Golden Matrix CEO Brian Goodman said: “We are thrilled to proceed with this acquisition as it aligns perfectly with our strategy of acquiring profitable and accretive businesses. Our previous acquisition of RKings Competitions has been a phenomenal success, significantly contributing to our revenues and profits, and we anticipate similar results with CFAC.”
17.?? Q2 2024: Better Collective price for Playmaker HQ drops by $31m
Better Collective CEO and co-founder Jesper S?gaard addresses the $31m price cut for Playmaker HQ and shares insight into how the company’s M&A strategy is evolving in response.
Alongside its Q2 2024 results, Better Collective announced a significant reduction in the acquisition price of Playmaker HQ, after the asset underperformed expectations.
The acquisition, initially valued at up to $54m, has been renegotiated down to $23m, representing a $31m reduction in price.
Despite its underperformance, S?gaard remains optimistic about the future of Playmaker HQ, referring to the period as a “hiccup” and affirming that he would still choose to acquire the business again.
18.?? Gambling.com raises 2024 forecast after record quarter
Gambling.com Group has raised its 2024 guidance after announcing a record-breaking quarter in which it completed its acquisition of Freebets.
In releasing its Q2 results for the three months to 30 June 2024, the affiliate marketing group said it now expects full-year revenue of $123m-￡127m and adjusted EBITDA of $44m-￡47m. In May, after the Freebets acquisition had already completed, Gambling.com predicted figures of $118m-￡122m and $40m-￡44m respectively. The midpoints of the new forecasts suggest full-year revenue growth of 15% and adjusted EBITDA growth of 24%.
The group reiterated its long-term goal of generating annual adjusted EBITDA of $100m.
#Legal & Regulation:
19.?? Brazil: 113 companies apply for online gambling licences
A total of 113 companies have officially applied for federal licences to operate online gaming and betting in Brazil, with over 50 applications submitted just yesterday (20 August), the final day for submissions.
Kaizen Gaming, the Greek operator behind the Betano brand, was the first to act, submitting its application on 26 May — just five days after the licensing window opened on 21 May.
The last to file was AF Tecnologia e Solu??es Financeiras Ltda, which completed its paperwork just before the window closed.
Companies applying for a licence were required to meet strict requirements, including establishing a local headquarters, create a subsidiary with a Brazilian national holding at least 20% of the share capital (for international firms), and maintain a financial reserve of at least BRL5m ($915,719) in addition to the licence fee.
20.?? NSW hits Playup DraftStars with record $586,000 fine for illegal inducements
Liquor and Gaming New South Wales has fined PlayUp Interactive AU$586,000 for offering customers inducements to gamble.
The penalty of AU$586,000 (€350,000) is the highest fine imposed by New South Wales for gambling infringements.
An investigation by Liquor & Gaming NSW found PlayUp Interactive, the operating company of fantasy games operator DraftStars, to have made 33 illegal offers promoting customer inducements.
The investigation found that: “DraftStars was found guilty on all 33 counts of publishing advertisements which included inducements to participate, or to participate frequently, in gambling activity – as well as an inducement to open a betting account, which is an offence in NSW.”
21.?? New Jersey fines Borgata for overstating promo credits by $4.5M
The New Jersey Division of Gaming Enforcement has fined Borgata Casino for overstating its iGaming promotional gaming credits by more than $4.5 million between October 2023 and May 2024.
The DGE noted that the incorrect reporting, which overstated iGaming promo credits by $4,564,515, led to a $365,161 underpayment of gross revenue taxes on Borgata’s June 2024 tax filing.
Borgata, which is an iGaming and sports betting partner of BetMGM, has agreed to pay a $75,000 fine.
In a letter to Borgata SVP and Legal Counsel Patrick Madamba, NJ DGE Interim Director Mary Jo Flaherty wrote that the NJ DGE identified the error in BetMGM iGaming platform reports submitted by Borgata between October 2023 and May 2024.