The New York Post has reported that Wynn Resorts is looking to offload its sports betting business at a cut-price of $500m. This marks a steep discount from last year's $3bn valuation.
According to these reports, Wynn is struggling to compete in the ever-growing and hugely popular sports betting market due to high taxes and the increasingly large promotional costs needed to lure customers away from more established sports betting brands.
If true, this news comes surprisingly soon after the operator launched its offering to the public, supporting it with high-profile deals such as the recruitment of NBA star Shaquille O’Neal as a brand ambassador.
Speaking on the current state of the market during an earnings call in November, the company’s outgoing CEO, Matt Maddox noted: “The market is really not sustainable right now. Competitors are spending too much to get customers. And the economics are just not something that we’re going to participate in.”
In a statement given to the post, Wynn Resorts refused to comment on so-called market speculation, stating: “We were clear on our last earnings call about the current highly competitive nature of the online sports betting market and our desire to operate that business in a way that will actually create long-term shareholder value.”
This news comes after the successful launch of mobile sports betting in the state of New York, a region in which Wynn is licensed to operate but has not launched its product.
While this story is still in its infancy, with no official word from Wynn, a deal to sell its sports betting arm would be gargantuan news for the industry.
