The CEO of GVC Holdings – MGM Resorts International’s 50% partner in Roar Digital – stepped down Thursday, but one analyst said his replacement was good news for the mobile gaming platform.
The United Kingdom-based company said CEO Kenny Alexander was retiring immediately and will be replaced by current Chief Operating Officer Shay Segev, who has led many of GVC’s recent integration projects.
Roar Digital, which operates the BetMGM sports wagering platform, was created in 2018 after sports betting was legalized in the U.S. following the Supreme Court’s decision to end the Professional and Amateur Sports Protection Act.
“GVC’s new CEO said its ROAR Digital joint-venture with MGM in the U.S. would be the number one strategic priority for the firm ahead of organic growth in its core European and Australian markets, and ahead of M&A,” said Alun Bowden, Eilers & Krejcik Gaming’s European analyst said in a note to investors.
Bowden said Segev set out five strategic pillars during a conference, with growing the U.S. sports betting market as the leading goal.
“Management said it had not yet turned its attention or its resources to acquisition marketing and this would be the next phase of its plan in the U.S. market,” Bowden said.
BetMGM parent Roar Digital said MGM and GVC committed to a second round of investment in the sports betting and iGaming operation. The investment now totals $450 million. Roar Digital now has more than $370 million of investable capital in an effort to compete in the expanding U.S. sports betting and iGaming markets.
The BetMGM brand is currently being utilized online through a mobile app, and through the branding of retail sportsbooks operated at MGM properties in Nevada, Atlantic City, and Michigan.
“Roar’s strategic shift comes as big brands with national ambitions are padding out their war chests for the next round of the U.S. online sports betting marketing wars,” Bowden said.
U.S. gamblers wagered more than $13 billion legally on sports in 2019, a figure that would have easily been eclipsed this year if the pandemic had not shuttered professional and college sports. There are now 18 states with legal sports betting operations. Four more states – Tennessee, North Carolina, Virginia, Washington – have approved sports betting laws and could launch later this year.
The sports betting operator space is filling quickly.
BetMGM is looking to move beyond MGM properties. Rush Street Gaming’s BetRivers.com is looking to expand beyond the company’s resorts. Meanwhile, DraftKings went public in April and FanDuel expanded through a deal with Boyd Gaming.
The scope of William Hill US will increase when the company takes over the Caesars Entertainment sports betting operations following the $17.3 billion merger with Eldorado Resorts.
Penn National Gaming is expanding its sports betting presence through its $163 million partnership with sports media platform Barstool Sports.
Deutsche Bank gaming analyst Carlo Santarelli said the iGaming and sports betting sector will become highly competitive as professional sports returns from its shutdown due to the coronavirus pandemic.
He said spending to “acquire and retain customers will be critical over both the near and the medium term, given the commoditization of the offering within the sports vertical.”
In Europe, GVC, operates the bwin, Ladbrokes, Coral and partypoker brands.
Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at hstutz@cdcgaming.com. Follow @howardstutz on Twitter.
