888 bets big on William Hill with £2.2bn acquisition
888, a world leading online betting company, beat the odds to snap up William Hill in a £2.2bn acquisition.
888 saw off fierce competition from Apollo Global Management and CVC Capital Partners to purchase the UK betting company which has over 1,400 retail betting shops across the country. The acquisition will create a global online betting and gaming giant which would have made an estimated $2.5bn in annual revenue and $464m in EBITDA last year.
The combination of the two companies is expected to deliver significant operating efficiencies, including pre-tax cost synergies of at least £100 million per year.
Commenting on today’s announcement, Itai Pazner, CEO of 888 said the acquisition was a “transformational and hugely exciting” moment for the company.
“This transaction will create one of the world’s leading online betting and gaming groups with superior scale, exceptional brands, increased diversification, and a platform for strong growth,” Pazner said.
William Hill and 888 have been pursuing complementary strategies in recent months by expanding into international markets. William Hill, which has been upping its online presence, operates across Europe and recently launched in Latin America while 888 is eyeing opportunities in North America.
Ulrik Bengtsson, CEO of WHI said that the merger was an opportunity for the companies to pursue further growth. He said, “scale is increasingly important in our sector and the combination of the businesses will provide a powerful alignment of brands and technology.”
Susannah Streeter, senior investment and market analyst at Hargreaves Lansdown, said the purchase was good news for high street betting stores, but cautioned that the move was something of a gample.
She said: “119 William Hill shops closed during the pandemic, and although this is a bit vote of confidence in the network, its likely there will be a further shake up in the branch footprint, not least because of the ongoing shift to online betting and profit headwinds.”
In order to fund the Acquisition, 888 has obtained debt financing from J.P. Morgan, Morgan Stanley and Mediobanca of approximately £2.1 billion, which includes approximately £1.6 billion of term loans.
Read more: Ladbrokes owner mulls swoop for William Hill’s UK betting shops