Posts Tagged ‘Buys’

The Stars Group Buys Sky Betting & Gaming for $4.7 Billion

 The Stars Group Buys Sky Betting & Gaming for $4.7 Billion

The Stars Group announced over the weekend that it has acquired Sky Betting & Gaming (SBG) for $ 4.7 billion in combination cash and stock deal. According to The Stars Group in a press release, the addition of Sky will make the company the largest publicly traded online gambling company.

The Stars Group is clearly best known as an online poker company, as its name comes from its ownership of PokerStars, the world’s largest online poker room, but this purchase balances the company’s numbers quite nicely. The Stars Group says that if Sky, CrownBet and William Hill Australia (the latter two of which were also recently acquired) were counted in the 2017 financials, poker would make up just 37 percent of The Stars Group’s revenue. An almost equal number – 34 percent – would have come from sportsbook, while 26 percent would have been casino.

“The acquisition of Sky Betting & Gaming is a landmark moment in The Stars Group’s history,” said Rafi Ashkenazi, TSG’s Chief Executive Officer, in the press release. “SBG operates one of the world’s fastest growing sportsbooks and is one of the United Kingdom’s leading gaming providers. SBG’s premier sports betting product is the ideal complement to our industry-leading poker platform. The ability to offer two low-cost acquisition channels of this magnitude provides The Stars Group with great growth potential and will significantly increase our ability to create winning moments for our customers.”

“We are delighted to join forces with The Stars Group,” added Richard Flint, Sky Betting & Gaming’s Chief Executive Officer. “We have had a fantastic last few years and would like to thank CVC and Sky for supporting us in becoming a leading online operator in the UK. This transaction allows us to offer our best-in-class products to a truly global audience. We’re excited about our future together.”

The Stars Group outlined the benefits of the acquisition, the first of which we have touched upon:

• Greater revenue diversification and significantly enhanced exposure to sports betting, the world’s largest and fastest growing online gaming segment, as the majority of SBG’s revenues are generated by sports betting.
• An increased presence in regulated markets, particularly within the United Kingdom, the world’s largest regulated online gaming market.
• The development of sports betting as a second low-cost customer acquisition channel, complementing The Stars Group’s core poker business and enabling more effective cross-sell to players across multiple verticals.
• Improved products and technology as a result of the addition of SBG’s innovative casino and sports book offerings, and portfolio of popular mobile apps.
• Identified cost synergies of at least $ 70 million per year.

The Stars Group will pay CVC Capital Partners and Sky plc, the owners of Sky Betting & Gaming, $ 3.6 billion in cash. To make up the other $ 1.1 billion, The Stars Group will pay with 37.9 million newly issued common shares. The value is based on the closing price of The Stars Group stock (NASDAQ: TSG) on April 20th, which was $ 29.30.

The transaction is expected to close in the third quarter of this year and has been unanimously approved by TSG’s Board of Directors.

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Golden Nugget Owner Tilman Fertitta Buys Houston Rockets for $2.2 Billion

 Golden Nugget Owner Tilman Fertitta Buys Houston Rockets for $2.2 Billion

The Houston Rockets NBA franchise announced this week that it has been purchased by Tilman Fertitta, owner of the Golden Nugget Casinos and Hotels. Though the team did not disclose details of the transaction, a source close to ESPN’s Adrian Wojnarowski said that Fertitta paid $ 2.2 billion for the club.

In a press release issued by the Rockets, Fertitta said:

I am truly honored to have been chosen as the next owner of the Houston Rockets. This is a life-long dream come true. Leslie Alexander has been one of the best owners in all of sports, and I thank him immensely for this opportunity. He has the heart of a champion. Lastly, out of respect for the NBA’s approval process, I can say no more other than I am overwhelmed with emotion to have this opportunity in my beloved city of Houston.

“I am excited to welcome and pass the torch to Tilman. He is a Houstonian, business leader and committed to the success and excellence of the Rockets both on and off the basketball court,” said current Rockets owner Leslie Alexander. “I have personally known Tilman for over 24 years and don’t think I could have found anyone more capable of continuing the winning tradition of our Houston Rockets.”

Alexander is making a pretty penny off of the sale. He originally purchased the Rockets in 1993 for $ 85 million. Fertitta was in on the bidding, coming up just short with his offer of $ 81 million.

The $ 2.2 billion purchase price was well above the $ 1.65 billion valuation Forbes magazine placed on the franchise this year. According to Wojnarowski’s sources, there was a bidding war for the Rockets, as Alexander received multiple offers starting at $ 2 billion.

This is not Fertitta’s first foray into professional sports in the United States. He was one of the original investors in the Houston Texans, the NFL team which was established in 1999 and began play in 2002. He was required to sell his portion of the team in 2008, though, because of his gambling business. Though the NFL makes tons of money because of gambling, the league’s rules stated at the time that no staff member of a team could be associated with gambling.

In 2003, Fertitta bought the naming rights to the Crawford Boxes section of the Houston Astros’ Minute Maid Park, an area of seating beyond the left field wall. The section was renamed “Landry’s Crawford Boxes,” taking on the name of Fertitta’s massive restaurant company, Landry’s Inc., which actually owns Golden Nugget.

Tilman Fertitta also has a history with the Houston Rockets beyond his previous bid for the team, serving as an advisory director during the team’s back-to-back NBA championships in the 1993-1994 and 1994-1995 seasons.

Houston clearly has more important things to think about right now than what billionaire owns one of its sports teams, but the Rockets did acknowledge this in the announcement, saying, “This process started back in July, and it is truly unfortunate that this announcement is occurring amidst the aftermath of one of the biggest tragedies in the history of our great City.”

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