888 Group Boost Business with William Hill Purchase
The gambling industry brings in billions of dollars of revenue each year and it’s obvious that this is a competitive market. Anyone looking to open up an online casino or sportsbook within this sector will find many hundreds of competitors already in place.
The crowded market doesn’t deter new companies from getting involved and fresh websites appear on a regular basis. With so much competition, even the established players need to find ways to get ahead.
Ely found that one way in which the big companies can grow a business is through mergers and acquisitions. It’s clear that two customer bases will be stronger than one and that’s why this type of deal has been seen relatively frequently in recent times.
Purchases continue and, in 2021, we saw the 888 Holdings Group move to acquire William Hill international. Both are historic brands with a long history but Hills are particularly well established, having set up long before the advent of digital betting.
The 888 Holdings Group were, meanwhile, one of the first companies to take advantage of the internet revolution. It’s an interesting deal between two of the most trusted players in the sector but what does it mean for both parties?
The Fine Print
The deal in 2021 saw 888 acquire William Hill’s European business from its American owner. The contract, therefore, is with Caesar’s entertainment and is said to be worth in the region of £2.2 billion GBP.
Included in the contract are William Hill’s physical businesses, the majority of which are situated in the UK. Hills were one of the first to take advantage of new rules in the early 1960s. Physical betting shops were allowed to open under the relevant gambling acts and this became a thriving part of the company’s platform.
The deal will, therefore, include all 1400 of William Hill’s betting shops. The move creates a combined group with some 1200 employees and clearly it’s a contract that has delighted all parties involved.
Speaking to industry press at the time the deal was announced, 888 Chief Executive Itai Panzer said:
“Our strategies are also complementary, being digitally led, customer focused, and committed to player protection and raising industry standards around safer gambling.
“We are also excited about the opportunities that the retail business provides and see significant brand benefits.”
Replying on behalf of William Hill, their Chief Executive Ulrik Bengtsson added:
“The William Hill and 888 strategies are highly complementary with an absolute focus on the product and customer experience.
“Scale is increasingly important in our sector and the combination of the businesses will provide a powerful alignment of brands and technology.”
Mr Panzer also went on to say that the deal would create ‘one of the world’s leading online betting and gaming groups. He specifically mentioned the enhanced exposure to sports betting that the acquisition would bring.
Whoever has owned them in the past or will do in the future, it’s unlikely that anyone will ever want to change the William Hill branding. The company was first established in 1934, with the BBC reporting it as being one of the first to gain a high street presence after gambling laws were relaxed in the early 1960s.
The Hills brand is known all over the UK and beyond. With that type of longevity comes a lot of trust because new customers will tend to gravitate towards companies that are familiar.
888 also have a presence and are a respected brand within the industry but their history simply cannot compare with that of William Hill. Simply by tying in with such a trusted name, they can increase their exposure exponentially.
William Hill will not necessarily need to have another name attached to their portfolio and it’s simply a case of becoming stronger. With a wider customer base to tap into, a significant company can now get even bigger.
Retaining US Interests
William Hill will retain their US businesses and that’s an important part of the contract. According to USAToday, Hills were one of the first to embrace the new gambling landscape after the US Supreme Court overturned the earlier PASPA ruling from 2018.
Sports betting halls were set up in casinos and on racetracks around the United States while William Hill also began to negotiate sponsorship deals with local sports teams.
In contrast, the 888 Group have been a little slower in embracing this new landscape. William Hill are clearly very ambitious when it comes to progressing their interests in the United States and it therefore seems logical to keep control of this side of the business.
Combine to Thrive or Survive
In 2022 and beyond, it’s not unreasonable to assume that we will see more of these purchases and mergers taking place. For companies of the magnitude of 888 Holdings and William Hill, it’s all about becoming stronger and gaining a bigger share of the market.
For smaller, newer businesses, a merger could be the only route to survival in such a competitive industry. After an uncertain year, similar moves could also be seen as a logical reaction to the challenges of 2020 and 2021.
For the larger players, the idea of combining to become a stronger entity is a natural step for many. The 888 deal with William Hill is not the first case of two gambling giants coming together and it’s almost certain that it won’t be the last.