William Hill has announced the sale of its Australian businesses, including TomWaterhouse.com, to CrownBet and group of investors linked to founder Matthew Tripp.
The deal was announced by William Hill chief executive Philip Bowcock on March 6 and will see CrownBet hand over $300 million to complete the purchase.
Final Price Exceeds Expectations
News of a potential sale broke at the close of February after four companies submitted last-minute bids. At the time, analysts suggested that offers from Ladbrokes, Bet365 and Sportsbet (owned by Paddy Power Betfair) were hovering around the $200 million mark.
However, as Bowcock announced the sale, he confirmed that William Hill will receive $100 million more than once the deal has been approved by regulators.
As part of the takeover, CrownBet will assume control of three Australian betting sites: TomWaterhouse.com, Sportingbet Australia and Centrebet.
When William Hill first entered the Aussie market in 2013, it spent around $700 million developing the business, which included purchasing the aforementioned betting sites.
Up until regulatory changes brought about a change in credit betting laws, the company had been profitable.
No Choice but to Sell
But a $133 million loss in 2017 was enough to prompt William Hill’s executives into review of the company’s assets. With revenue down and the future regulations possible, a decision was made to sell.
“While we remain one of the few profitable companies in the market, that profitability would be significantly impacted if, as is anticipated, further states introduce an additional 15 per cent point-of-consumption tax in the coming months and years,” read a February 23 press statement.
Now out of the market, William Hill will consolidate its business in the UK and Europe as well as focus on growing its US assets ahead of any potential changes to local sports betting laws. For CrownBet, the purchase is its second major move of 2018.
On February 27, CrownBet announced that the Stars Group had purchased Crown Resorts’ 62 percent stake in the company. With the parent company of PokerStars now in control and a trio of new assets to play with, CrownBet has solidified its position as the largest online gambling operator in Australia.
Packer’s Crown Slips
In other news, Melbourne’s Crown Casino could lose its gambling licence after the Victorian Commission for Gambling and Liquor Regulation (VCGLR) found evidence of potential illegal activity. Following a 2017 charge that Crown had deliberately removed certain betting options from its pokies, the VCGLR has concluded that the move breached gaming regulations.
Despite maintaining that the removal of some features was part of a trial, Crown has informed shareholders that a review is underway and that it may now face disciplinary action.
At this stage, the VCGLR hasn’t made it clear what action it plans to take. However, as well as a fine, the VCGLR is within its rights to revoke the casino’s gaming licence.