Eldorado Resorts and William Hill US completed their partnership transaction Tuesday that gives the regional gaming giant a 20 percent ownership stake in the sportsbook operator in exchange for a 25-year deal to operate facilities in the company’s casinos where sports betting in legal.
William Hill US and Eldorado will co-develop sports books and add the infrastructure needed for mobile and online wagering. Eldorado operates 26 casinos in 12 states, including Nevada, Mississippi, New Jersey, Pennsylvania and West Virginia, where sports betting is legal. William Hill has operated the sportsbooks at Eldorado’s Reno resorts since 2012.
“Based on our long-term experience in Reno, we believe that the addition of sports wagering to our entertainment offerings will drive customer visitation and create a new revenue stream at our properties while enhancing our existing gaming and non-gaming revenue,” Eldorado CEO Thomas Reeg said in a statement.
William Hill US’ existing sports betting businesses include casinos and racetracks in Nevada, New Jersey, Delaware, Iowa, Mississippi, West Virginia, The Bahamas and St. Kitts.
Reeg said the companies will add sports betting locations at Eldorado casinos as states legalize the activity.
The transaction received regulatory approval in several states as well as federal anti-trust approval.
In addition to the 20 percent stake in William Hill US – valued at $50 million when the deal was announced in September – Eldorado will receive 13.4 million ordinary shares of William Hill US parent William Hill PLC, which is traded on the London Stock Exchange.
In a statement, Eldorado secured the right to monetize its equity in William Hill US if the company completes a public offering or through a conversion of the equity stake to William Hill PLC shares, or cash at William Hill’s discretion after five years.
Eldorado recently struck a 20-year agreement with The Stars Group for potential real money online gaming and online poker opportunities in the U.S.
Shares of Eldorado closed at $44.11 on the Nasdaq Tuesday, down 45 cents or 1.01 percent.
Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at hstutz@cdcgamingreports.com. Follow @howardstutz on Twitter.
