The Final Furlong: Who Will Win the Race to Acquire William Hill UK?

William Hill High Street Betting ShopIt’s been one of the most hotly-contested heavyweight clashes in the UK gambling sector for quite some time….

Ever since Caesars Entertainment declared that they were selling William Hill’s European operations as part of their acquisition of the firm, a number of pugilists have donned their gloves and begun sparring.

In the red corner we have 888 Holdings, who you know from their 888sport handle (amongst other things). They have been aggressive on the mergers and acquisitions front, and so have plenty of capital to work with.

In the blue corner is Betfred, with Fred Done reportedly ready to sink some of his own fortune into snapping up the mainstay of UK betting circles. Done has been a William Hill shareholder in the past, and pocketed around £200 million by selling his 3% holding to Caesars earlier in 2021.

And then in the, erm, green corner we have Apollo Global Management, a private equity firm that has sunk billions into businesses in a variety of sectors all over the world.

That hard-hitting trio has now been joined in this tired boxing metaphor by a plucky unbeaten upstart. According to reports from Sky News, Tipico – the largest sports betting firm in Germany – is looking to take on the champion, and they have laid down a marker by lodging a ‘credible’ bid with the master of ceremonies for the sale, Deutsch Bank.

There will be plenty of jostling for position in the weeks and months ahead, but who is expected to deliver the knockout blow and seal the deal with Caesars?

Money Talks

Pile of Money

Having splashed out £2.9 billion to acquire the rights to the William Hill branding, the American gambling giant Caesars Entertainment is not going to let the firm’s European assets – which includes thousands of betting shops, their online sportsbook and other channels including their casino – go at a snip of a price.

A figure of £1.5 billion has been suggested as a starting point, and so any bidding party will have to have plenty of readies at their disposal to get their acquisition over the line.

For Tipico, that shouldn’t be too much of a problem. They are backed by CVC Capital Partners, a private equity firm that has invested in all manner of companies around the world. CVC aren’t short of a bob or two, and given that they have Tipico, Bruin Sports Capital and Premiership Rugby in their portfolio already clearly this is a field they are willing to invest heavily in.

Ironically, CVC were part of a consortium that acquired William Hill back in 1999, and oversaw the bookmakers floatation on the London Stock Exchange a couple of years later. They obviously consider the firm to be undervalued once more.

888 Holdings, a gambling operator that has used acquisitions and mergers to expand its growth in the sector, are another with plenty of financial muscle.

Their chief executive, Itai Pazner, revealed back in March that his company would certainly be interested in William Hill’s UK facing assets, saying: “It’s [bidding] coming up relatively soon, and we’ll definitely be looking at it.”

Interestingly, Jefferies – a financial services and investment firm in London – had told their clients to buy shares in 888 ahead of a potential bid back in June. “Investors should buy 888 shares ahead of any deal to acquire the William Hill assets, in our view,” their analysts said. That would suggest that there’s confidence that 888 Holdings are very much in with a shout.

Of all the frontrunners, not a huge deal is known about Apollo Global Management as far as their intentions in the gambling sector are concerned.

They claim to have around $72 billion in assets around the world, and their focus is rather diverse and wide-ranging – Chuck E. Cheese’s restaurants, ADT Security and Claire’s Accessories to mention just three brands in their portfolio.

Interestingly, Apollo does own a share in Caesars Entertainment and Ladbrokes/Coral, so there is a clear interest in the sector – could their existing connection with Caesars also be of help?

When Will William Hill Be Sold?

The details are actually quite sketchy about the bidding process, but it has been suggested that Caesars want to announce the successful buyer either in the third or fourth quarter of 2021.

That would allow for all the due diligence and red tape to be completed in advance of a scheduled May 2022 handover.

So, in a matter of weeks or months, we will know who will take over the running of the fine William Hill band, which has been a bastion of the UK betting industry for pretty much the past century.