Endeavor Group Holdings will acquire sports betting company OpenBet from Scientific Games for $1.2bn.
Beverly Hills-based Endeavor is a sports and entertainment company and owner of the mixed martial arts league UFC.
Scientific Games will receive $1bn in cash and $200m in Endeavor Class A common stock. The transaction is expected to close in the second quarter of 2022.
OpenBet, based in London, specializes in sports betting software. OpenBet says it processes 40% of digital sports bets in the United States. Its customer base includes DraftKings, FanDuel, WynnBet and William Hill.
“OpenBet has built an incredible sports betting suite anchored in its best-in-class betting engine and now including expanded content, services and products for sports books and fans,” said Ariel Emanuel, CEO, Endeavor. “This capability set is the ideal complement to our IMG ARENA sports betting business, which works directly with sports rights holders. We look forward to growing these businesses together to capitalize on the strong secular tailwinds in the sports betting ecosystem.”
Scientific Games announced in June it intends to divest its lottery and sports betting business.
“This transaction represents the culmination of a thorough process to divest OpenBet in order to maximize value for our shareholders and rapidly advance our vision to become the leading cross-platform global game company,” said Barry Cottle, President and Chief Executive Officer of Scientific Games. “The transaction is a significant milestone towards optimizing our portfolio and de-levering the balance sheet to enhance our financial flexibility. It will position us to invest both organically and inorganically in key growth areas, particularly in content and digital markets. We are delivering on our promises and executing on our strategy to transform our company and unlock significant value for employees, customers and shareholders.”
Scientific Games was trading at 82.95 USD, up 2.05%, late Monday, while Endeavor stock was up 0.33% to 27.31.
