- US Online Poker
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- US Online Sports Betting
- FEATURE: Ontario Online Gambling
This is a developing story and will be updated.
The Stars Group announced on Saturday morning that it had acquired UK-focused Sky Betting & Gaming in a cash and stock deal worth $4.7 billion.
With that, the parent company of online poker giant PokerStars made its intentions to be a major part of the international sports betting market known loudly. In a press release, Stars Group said that the deal would result in creating the “world’s largest publicly listed online gaming company.”
The deal is almost as big as the one in which Amaya — the former name of Canadian-based Stars Group — acquired PokerStars in 2014, for $4.9 billion.
The Stars Group’s meat and potatoes is online poker, and this will diversity its offering, s the company noted:
The development of sports betting as a second low-cost customer acquisition channel, complementing The Stars Group’s core poker business and enabling more effective cross-sell to players across multiple verticals.
The deal is expected to close in the third quarter of 2018. Previously, Sky Betting had been preparing for a public listing.
TSG also said the deal “identified cost synergies of at least $70 million per year.”
It’s also likely a move to position the Stars Group for further entry into the prospective market for online gambling and sports wagering in the US. A number of states have legalized wagering should New Jersey prevail in its case in the US Supreme Court case dealing with the federal ban on single-game wagering. PokerStars already serves NJ as an online poker and casino operator.
It will also allow Stars Group to offer a compelling poker, online casino and sportsbook in parallel in a state like Pennsylvania, which has legalized all three (pending the Supreme Court decision).
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“The acquisition of Sky Betting & Gaming is a landmark moment in The Stars Group’s history,” stated Rafi Ashkenazi, the Company’s Chief Executive Officer. “SBG operates one of the world’s fastest growing sportsbooks and is one of the United Kingdom’s leading gaming providers. SBG’s premier sports betting product is the ideal complement to our industry-leading poker platform. The ability to offer two low-cost acquisition channels of this magnitude provides The Stars Group with great growth potential and will significantly increase our ability to create winning moments for our customers.”
“We are delighted to join forces with The Stars Group,” said Richard Flint, Sky Betting & Gaming’s Chief Executive Officer. “We have had a fantastic last few years and would like to thank CVC and Sky for supporting us in becoming a leading online operator in the UK. This transaction allows us to offer our best-in-class products to a truly global audience. We’re excited about our future together.”
Suffice it to say, this is a major deal for the gambling sector generally and for the UK market in particular.
“SBG is one of the most attractive assets in the sector right now and the deal is genuinely transformational for Stars Group and gives it immediate scale and expertise in sports betting as well as adding a large chunk of revenues to its casino business,” said Alun Bowden, a senior consultant for Eilers & Krejcik Gaming. “SBG has around 12 percent of market share in the UK and the deal will makes the combined group one of the largest operators in the UK market alongside Paddy Power Betfair and GVC.
“But it’s what it does for non-UK revenues that is the most interesting. SBG has been 100 percent UK for most of its existence and only recently moved into the regulated Italian and quasi-regulated German sports betting market where it can utilize the brand strength of Sky. We wouldn’t expect the Sky Bet brand to be used in many of TSG’s international markets, but the product, technology and expertise could be a huge boost to TSG’s sportsbook ambitions.”
This is hardly the first time PokerStars has tried to increase its presence in the sports betting market: