Britain’s Sky Betting & Gaming to Be Sold to Canada’s Stars Group in Billion-Dollar Deal
The Canadian company Stars Group Inc., which specializes in online gaming, has agreed to pay $4.7 billion in cash and stock for the British company, Sky Betting & Gaming. This move will allow Sky Betting and Gaming to become the largest publicly listed online gaming company on both sides of the Atlantic Ocean. The sale should be done by the middle of this year.
Stars Group already owns several different divisions, including the online gaming engines PokerStars, PokerStars Casino, BetStars, and Full Tilt Poker, as well as the live poker offerings PokerStars Championship, PokerStars Festival, PokerStars Live, and MEGASTACK Live Poker. Revenues for the company exceeded $1.3 billion in 2017.
Acquiring Sky Betting & Gambling would also give Stars Group access to its brands, including Sky Bet, Sky Vegas, Sky Casino, Sky Poker, and Sky Bingo.
Why Sky Betting and Gaming
The move was seen as a way for Stars Group to get out of the online poker market. While this particular market has seen enormous growth over the last 10 years, it is currently stagnant. By acquiring Sky Betting & Gaming, which is presently owned by CVC Capital Partners, Stars Group takes over a large and growing sports-betting market that is not only in Europe but in Australia as well. Stars Group will move from a 75 percent revenue share in online gaming to a 60 percent revenue share in sports gaming, which will further move the company toward a more profitable future. Stars Group, which has its headquarters in Toronto, is poised to also gain a significant share in the gaming market in the United Kingdom. This will allow the company to have access to new customers for its online casino and poker games.
Stars Group has tried to move into the larger markets in the past. In 2016, it failed in its attempt to take over London bookmaker William Hill PLC. However, this time, the company had more success in its takeover attempt, partly because Sky Betting & Gaming is cash poor and needs the cash infusion to ready itself for a bidding war between 21st Century Fox and Comcast over its holdings. Stars Group has been signaling that it is ready to acquire other companies, having paid the company debts from previous acquisitions, such as Amaya.
Why the Move Now
Gaming insiders have said that the move by Stars Group, is, in part, in response to the possibility that many states in the United States may begin to offer sports betting. This month, the U.S. Supreme Court overturned a 1992 law, called the Professional and Amateur Sports Protection Act or PASPA, that banned sports betting in all states but four: Delaware, Montana, Nevada, and Oregon. The ruling allows states to decide for themselves whether they wish to start offering sports betting. New Jersey may be the first to allow single-player betting. It already has the infrastructure in place.
The Stars Group already has a giant poker and online gaming platform. Now, with the addition of Sky Gaming, the sports-betting platform, the company seems poised to move into the gaming market in the United States. The potential to make a profit in the U.S. sports-gaming market is huge. Approximately 75 percent of U.S. adults consider themselves to be sports fans, and about 55 percent said they would bet on sports if they could. The only state in which single-sports gaming is available, Nevada, saw a record amount of money bet in 2017: $250 million. This means that the potential for profit from online sports betting in the United States is nearly unlimited.
As an avid video poker player and lover of real money online blackjack, Thomas is the founder and guiding voice behind the Top Casino Picks community. A project manager at a London based Fortune 500 tech company, Thomas is an online casino enthusiast who founded TCP as a hobby to help other players avoid the headaches and hassles he has encountered when trying to find the best real money online casinos.
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