Month: April 2021

Virginia opened its legal sports wagering market on January 21, with the amount bet in February being 351.3% higher than in the opening 11 days of activity.

This was helped by the National Football League’s showpiece Super Bowl event, which attracted $19.6m in bets, or 7.3% of total wagers placed in the month.

Revenue after customer winnings for the month stood at $12.2m, up 238.9% on the January period, after players won a total of $253.5m from sports betting.

However, AGR, which is defined by the Virginia Lottery as bets minus winnings and other authorised deductions – including bonuses and promotions – came in at a loss of $3.2m for February, level with the $3.2m loss posted in January.

The Virginia Lottery said this was primarily due to promotional expenses related to customer acquisition, with only one operator reporting positive AGR for the month.

Read the full story on iGB North America.

By the final quarter of last year the affiliate sector seemed to have put the pandemic firmly in its rearview mirror. With the exception of Acroud, revenue and EBITDA improved on a year-on-year basis for all of the operators covered in the Affiliate Monitor.

However, much of this growth had been bought, with the two top-performing affiliates in terms of revenue growth – Better Collective and Raketech – having made significant acquisitions last year.

The former’s €44m addition of Atemi Group to its business at the start of the quarter brought an immediate boost and saw it eclipse Catena Media to become market leader during the fourth quarter.

The latter’s Lead Republik acquisition of early last year was evidently paying off by the end of the year, while its buyout of American Gambler in November may take longer to filter through to its results.

At the other end of the leaderboard, long-time laggard Acroud is hoping to turn things around via M&A. The company has been on something of an acquisition spree since the beginning of this year and has indicated there is more to come.

And after a two-year lull in any significant consolidation activity, Catena Media looks set to throw its hat back into the ring, stating during its fourth quarter conference call that M&A is back on the table. Whether or not it can regain its market-leading position using the strategy that helped get it there in the first place remains to be seen.

Stephen Carter
Editorial director, iGB

Under the agreement, Kindred paid £25m (€29.3m/$34.5m) in cash to acquire the business on a debt-free basis.

Rank said proceeds from the sale support its liquidity and future initiatives as part of its Transformation 2.0 programme.

The agreement, which was announced in October last year, set out that Kindred would acquire 100% of shares in Blankenberge Casino-Kursaal (Blancas), the Rank subsidiary that operates the casino.

Kindred has worked with Blancas since 2012, with the country’s online gambling regulations requiring igaming operators to have a land-based partner to offer online casino, live dealer games and poker.

Casino Blankenberge is one of nine land-based facilities operating in Belgium, and had been owned by Rank since 1998.

The casino’s concession agreement with the city of Blankenberge was renewed in 2018, with a new 15-year operating licence having come into effect in January this year.

The sale confirms Rank’s exit from the Belgian casino market, having shut down operations in the municipality of Middlekerke in 2017.

The figure also gives March the highest revenue figure in 2021 so far, up 13.6% on the MOP7.31bn generated in February, and 3.5% higher than the MOP8.02bn recorded for January.

Cumulatively, that gives the special administrative region a GGR of MOP23.64bn since the beginning of 2021, which still leaves the year down 22.4% on the MOP30.49bn brought in by the end of March 2020.

The majority of the revenue generated between January and March 2020, MOP22.12bn, was made in January, prior to the closures of gaming venues from February as a result of the novel coronavirus (Covid-19) pandemic, which saw Macau’s gaming industry hit a standstill for the majority of the year.

Major operators in the region saw revenues plummet last year, with Sands China revealing a $1.52bn (£1.1bn/€1.29bn) loss for the year after its revenue dropped by 80.8%.

Melco Resorts and Entertainment, meanwhile, made a $1.26bn loss as its full year revenue was reduced by 69.9%.

GGR for the region declined by 79.3% in 2020, amounting to MOP60.44bn compared to MOP292.46bn in 2019.

Allied’s revenue from continuing operations – which excludes the poker assets – came to $3.2m, down 57.5%, over the 12 months to 31 December 2020

The business made $3.0m from in-person content, its main revenue stream, in 2020, down 60.0% compared to 2019, after live events were halted by the novel coronavirus (Covid-19) pandemic. 

Multiplatform content, on the other hand, saw revenue grow significantly, albeit from a low base. A 344.4% year-on-year rise took the multiplatform revenue for the year to $222,400.

Read the full story on iGB North America

The National Survey of Gambling Attitudes and Gambling Experiences (NGAGE) is the first national research report on gambling attitudes since the National Gambling Impact Study Commission in 1999.

The report highlighted the ongoing problems with young people and problem gambling. Half of under 35s surveyed chose “yes” to at least one of four questions that indicated a risk of problem gambling, compared to only 10% of over 65s surveyed.

Read the full story on iGB North America.

At the start of it all was a greyhound track. Lincoln Park in Rhode Island, then owned by a British company trading under the Wembley brand, was acquired by an investment consortium in 2005, followed by a deal for Colorado’s horse racing track Arpahoe Park later that year. 

Chapter 11 bankruptcy followed in 2009, before Twin River Worldwide Holdings emerged from that process. It was not until 2014, with the acquisition of Hard Rock Biloxi, that the business operated more than one casino. 

Seven years on the business now known as Bally’s Corporation maintains a network of 15 casinos across 11 US states, with a database of 15 million players. It can offer sports betting in 13 states.

Through a wide-ranging partnership with Sinclair Broadcast Group, there will be a network of regional sports networks under its brand. Customer acquisition and retention will be aided further by its acquisition of daily fantasy operator Monkey Knife Fight, and free-to-play sports specialist SportCaller.

It’s also aiming to pioneer what it describes as a B2B2C model, running supplier and customer-facing businesses in tandem, through its acquisition of Bet.Works. All of these elements could be considered transformational. 

But it’s the potential deal to acquire Gamesys that stands above everything else. It would bring together a business with a thriving and diversified igaming operation, with Bally’s sports betting and brick-and-mortar assets. 

“Gamesys is one of the small handful of online gaming businesses which have successfully penetrated the mass market segment; it also has its own technology and has demonstrated that it can work successfully with big grown-up brands,” Regulus Partners’ Paul Leyland wrote of the deal. 

“The Virgin brand is also present and moderately successful in New Jersey. In this context, what Gamesys can bring to the developing US igaming market is as clear as it is attractive. Bally’s also fixes Gamesys’s tardy US state access situation.

“With dynamic management and a strong access footprint, a vertically integrated approach to igaming makes a lot of commercial sense,” he continued. “Equally, Gamesys was one of the few listed gambling companies with US exposure that was not enjoying much (if any) of the hype premium: the valuation is therefore attractive too.”

The structure for the combined business is already in place. When Bally’s announced its $125m deal for Bet.Works, it outlined plans to split the business into brick-and-mortar and interactive divisions. This will see Papanier manage the land-based portfolio and Bet.Works founder and CEO David Wang become chief executive of the newly minted Bally’s Interactive arm. 

Papanier is limited on what he can say, as an announcement of ongoing talks, under Rule 2.4 of the UK Takeover Code has been made. It won’t be until an announcement under Rule 2.7, announcing a firm intention to go forward with the deal, that the full plan can be set out. 

However, he tells iGB the land-based and interactive structure announced in the wake of Bet.Works will be implemented: “We will initiate that structure once we close on the Bet.Works deal, which is slated to close in Q2, and that structure will remain in place,” he says. 

“All the interactive assets will fall into that division, so all of those, including Gamesys, will fall under that silo.”

This will see Gamesys chief executive Lee Fenton take charge of the combined entity, per the agreement announced in March. The Jackpotjoy operator’s founders and executives have already announced they will back the deal, with Robeson Reeves also taking up an executive role, and two directors joining the Bally’s board. 

The restructuring will most likely take place in June, when the Indiana Gaming Commission holds its next meeting. Once the Bet.Works deal is approved by the regulator, Papanier is confident that the transaction can be closed “almost instantaneously”. 

While this means a proprietary sportsbook, under the Bally Bets brand, will not go live until the second half of the year, there will be no knock-on effect to the partnership with Sinclair Broadcast.

This will see its regional sports networks, previously under the Fox Sports brand, rebranded as Bally Sports. 

“The renaming is underway as we speak,” Papanier says. “You’ll see the roll-out of that with the start of the baseball season, so you’ll see all the rebranding and signage changes, from Fox Sports to Bally’s. 

“The Fox Go application, which has more than 30m subscribers, will be rebranded as Bally Sport as part of this. That is going to be significant in reducing acquisition costs. None of that is being limited by the closing of the Bet.Works transaction.”

Nor are these deals likely to slow Bally’s M&A drive, he adds. 

“We’re going to continue to be opportunistic,” Papanier continues. “We’ll prioritise access to sports betting and igaming, both via brick-and-mortar and through open agreements, but we’re always going to look for complementary technologies and platforms for igaming, such as the Gamesys deal. 

“We’ll also look for more deals similar to Monkey Knife Fight and SportCaller, so wherever that takes us, that will be our motivation.”

And this won’t be limited to sports betting. While the pace of regulation and market openings are outpacing those of igaming, Papanier is confident online casino will catch up, especially in the post-Covid world. States are going to be looking for new revenue sources, and opportunities to generate additional revenue, he says, which makes igaming a natural progression from sports betting. 

While brick-and-mortar remains his “wheelhouse”, Papanier says his position on the board will allow him to participate “in an intimate role” as Bally’s expands online. And he’s certainly keen to keep that engagement going. 

“I was privileged enough to ride the wave of casino expansion in the US, and now I get to participate in a complementary wave of expansion through igaming and sports betting,” he explains. 

After all, he says, the business has changed beyond recognition from the one he joined as chief operating officer in 2004. Now with 15 casinos in 11 states, plus robust betting and igaming operations, and with the potential to be one of the first operators to offer a truly omni-channel product range.

“I’m really proud to have participated in that transformation in the company in such a short space of time,” Papanier says.

The business’ revenue was down 40.6% when compared to the same segments in 2019.

Sportech chief executive Richard McGuire said it was an extremely difficult year for the business because of the impact of the novel coronavirus (Covid-19) pandemic, but noted that it performed better than its March expectations.

“Covid-19 created unprecedented challenging conditions for our businesses and the industries we serve,” McGuire said. We continue to take the necessary actions to safeguard the Group and to progress our strategic agenda. 

“In line with this, the Group took steps to generate tangible investor returns by exiting certain businesses and assets, advancing the sale of the racing and digital division’s Global Tote business to BetMakers, the sale of the Bump 50:50 raffle business to Canadian Bank Note, and the disposal of a freehold property in Connecticut.

“Despite the challenging global environment, our performance in 2020 was better than initially forecast in March 2020, with Sportech delivering on key 2020 performance metrics, namely cash generation from operational activities, effective capex management, and delivery of a more efficient lower operational cost base going forward, resulting in only a modest cash outflow since the outbreak of COVID-19.”

As it sold the Global Tote business during the year, wagering at venues made up most of the continuing Sportech business’ revenue, down 36.0%.

Food and beverage sales at those venues brought in an additional £1.5m, down 66.5%.

The business made £2.9m from its lottery business, down 43.3% year-on-year.

Sportech paid £9.4m in costs of sales, for gross profit of £10.5m, down 42.6%.

After marketing and distribution costs of £319,000, down 62.0%, Sportech was left with £10.2m, 41.7% less than in 2019.

The business then paid a further £12.3m in operating costs and £261,000 in investments for an adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) loss of £2.3m.

Following share options, depreciation, amortisation and impairment, Sportech’s operatingloss was £10.0m.

It incurred a further £557,000 in finance costs for a £10.6m pre-tax loss. After a £297,000 tax benefit, Sportech’s overall loss from continuing operations was £10.3m, 41.7% less than the same segments lost in 2019.

In addition, the operator’s Global Tote business, which was sold to BetMakers, and its Bump 50:50 business, which was sold to Canadian Banknote, made a combined £2.6m loss after recording revenue of £25.7m. 

When these segments are accounted for, Sportech made a final loss of £12.8m, which was 11.7% less than 2019’s loss.

McGuire added that the business was currently engaging with the Governor of Connecticut, Ned Lamont, following statements “that appear to deny Sportech equal rights to a Connecticut State Sports Betting licence” as the state looks to expand its sports betting offering.

Lamont has confirmed his intention to launch betting and igaming in his State of the State address in January, but current plans involve the state’s two tribal operators: the Mashantucket Pequot Tribe and the Mohegan Tribe.

The acquisition was made via a share subscription, with 500.com purchasing a total of 169,354,839 shares at a price of HK$0.62 per share, as per a deal agreed in January.

500.com now holds a 54.3% ownership interest in Loto Interactive, increasing its existing holding from 33.7%.

In relation to the subscription, Loto Interactive has completed its acquisition of the remaining equity interests in indirectly held subsidiary Ganzi Changhe Hydropower Consumption Service Co.

Loto Interactive purchased the interests from two sellers for a consideration of approximately $104.4m, increasing its ownership of Ganzi Changhe to 100%.

Pursuant to the Hong Kong Code on Takeovers and Mergers, 500.com will now be required to make a cash offer to acquire all the remaining shares of Loto Interactive at $0.75 per share.

In addition, 500.com said it will now make a cash offer for the cancellation of all options of Loto Interactive, again in accordance with the Hong Kong Code on Takeovers and Mergers.

With years of experience, operators have become adept at getting customers onto their sites. 

But as key channels may get shut off thanks to tighter regulation, increased competition and – in the US – a need to shift from investment to profitability, these operators need to find ways to maximise the value of those customers, and that means finding ways to retain them and encourage them to bet.  

To Yoav Ziv, vice president for sales and business development at LVision, engaging customers is the most natural way for operators to differentiate themselves. 

“All operators, at the end of the day, want things that will increase turnover,” Ziv says. “But assuming that everyone is offering similar markets, that they have similar general offerings, it becomes about engagement.” 

His business’ BetBooster product is one in a wave of new attempts to increase engagement through personalised content. 

Looking at historical data and live events, the product tracks trends and patterns to help inform punters’ bets.  

This data is then personalised, offering players insights specifically related to the bets they have placed in the past. 

“After one or two months, we’re going to have a lot of data,” he says. “It is of course collected anonymously – but we know that the anonymous player likes to bet on Asian handicap markets on the Premier League, so we can offer tips and insights about those games. Or you can offer tips for similar markets and maybe try to expand the way in which the player bets.”  

Freedom to choose 

As these tools become more popular, they have become available for a wider range of markets, including for sports and verticals that may have been neglected when it comes to technological developments. 

EquusForm’s Bet Finder tool, created by Jim Fitzmaurice and Michael Turner, shows a different side of personalisation for bet stimulation. Unlike tools which personalise themselves to a customer, it is designed to allow customers to personalise tips for themselves: showing a list of horses based on user-selected criteria such as form and odds. Viewers can then see the performance of horses in past races that meet this criteria. 

“We made it twofold really,” Turner says. “We put the genie function on the top, so you can press one of three buttons and the genie will make selections for you. That can be maybe for someone who’s just starting to get into horse racing. 

“But then we’ve also made something for the more astute punter. We come from a more form-reading background, but traipsing through newspapers, spending hours looking at form takes too long. The BetFinder cuts that down to second.  

“The punter can choose their own criteria. They can have as much or as little criteria as they like and either way it can give horses in all the day’s racing within seconds.” 

While tools to increase engagement have been popular in other sports, Turner adds that horse racing – despite being such a key sport for betting – had previously been left behind in this area. 

“I think racing has been neglected for a lot of years,” he says. “The online sites have been jumping on the latest bandwagon. Horse racing is, believe it or not, on the rise, but bookies haven’t been putting out new products that engage these customers. 

“In football, there’s a lot of different ways to bet and there’s lots of widgets, but in horse racing, nobody’s really done it.” 

A hub for content 

Streaming, by offering bettors the opportunity to watch while they bet, has been a clear way to increase engagement. 

For Aviv Arnon, co-founder and vice president of business development at WSC sports, sports betting represents an opportunity to leverage assets that it already created. His business had been delivering sports content for media companies for more than a decade before venturing into the world of betting in an agreement with FanDuel, initially covering PGA Tour golf. 

Rather than delivering betting tips, WSC creates personalised highlights for players. 

“We work with whoever owns sports media rights, and we have a cloud platform that basically analyses every moment of a game and the context of the moments involved,” Arnon says. “So what was the moment, what just happened, who did it, how important was that moment.  

“It analyses the footage of the broadcast, the reactions of the crowd and commentators and the statistics of the plays, and delivers relevant highlights. 

“ We traditionally worked with media, with clubs with broadcasters, but now there’s an increasing convergence with other areas because of how consumption is changing. 

“There’s a unique synergy with what we do and what betting operators want to achieve.” 

Those highlights are then personalised based on betting activity, so players who bet on an individual golfer are likely to see highlights related to their performance. 

Adam Kaplan, general manager of FanDuel, says that the deal represented a greater shift in general towards making the operator more of a home of sports content than ever before, stimulating betting activity by keeping customers around not only to bet but also to stay on top of sporting events. 

“Content is an area where we’re investing very heavy and the opportunity to leverage WSC’s capabilities with great content was an opportunity worth pursuing and focusing on,” he says. “I think there’s a clear path to growing our addressable audience and reach in a way that can drive our gaming businesses. 

 “We can do that by enriching the customer experience through content and through experiences.  

“This is just one step towards that, but WSC is definitely going to be a big part of that strategy.” 

While this foray into betting only covers one sport for now, Arnon says you need only to speak to those involved with other sports and competitions to see that the appetite exists to broaden the scope. 

“That’s already an opportunity where we could and will expand,” he says. “Our existing clients are all the major sports leagues in the world and they’re all thinking about ways to work with betting operators.” 

Overcoming challenges 

For Arnon, the move to the world of betting has had differences with anything his business had done before. 

“It’s a little different,” Arnon says. “There’s a lot of the core of what we did for media in this, but there’s new ways to think of it when it comes to building a customer experience.  

“We’re trying to create an experience that complements what FanDuel is doing and the ability to deliver the right video at the right time to the right person to incentivise them to come back involves different challenges.” 

LVision, meanwhile, found much of the challenge concerned integration. The supplier therefore worked to create a version of its product that could be implemented easily. 

“When we started with the product we offered it as an API solution, but it was rejected by many potential customers who said they didn’t have the resources, other regular excuses that customers like to use,” he says. “But then we made a shift to make it a widget, or maybe even more of a web component.  

“There’s just three lines of code to include everything, including the language component.” 

Turner, meanwhile, noted that working with operators to build the product, speed was one of the most important things operators looked for. 

“What we tried to do with the BetFinder is to make it really simple,” he says. “So if any customer was new to horse racing they can just open the BetFinder, click a few buttons and then it’ll give them a few horses that they can add to betslip and place the bet. 

“Everyone was after speed. Everyone wanted to know how fast you can go in and place a bet.”  

Similarly, Ziv said he was surprised to find that an increase in the speed at which players place bets turned out to be one of the key benefits of BetBooster in A/B testing, alongside growth in turnover, betting volume and average size per bet. 

New ways to personalise 

While showing content based on past betting activity is the most obvious form of personalisation, both Ziv and Kaplan point out that there are other ways to personalise content too. 

“We know how to collect data on logged in players and we know how to collect data based on cookies,” Ziv says. 

“We have different levels of personalisation. So if we don’t know much about a player’s betting but we know their city or country or language, we can offer betting based on popular teams or sports in that region.” 

Kaplan says that this type of customisation available in WSC’s product, meanwhile, can be used in conjunction with marketing activities. 

“You can imagine if we’re running certain promotions or odds boosts, we might want to enhance that experience by delivering certain content to those users,” he says. 

Ziv says that ultimately, allowing the player to be more involved in the betting process provides a huge number of opportunities for operators. 

“BetBooster definitely allows that engagement operators are looking for because it offers a new level of betting,” Ziv says. “It involves mobile notifications. It creates a lot of new engagement opportunities for operators and for the punter it makes the customer feel more involved and more educated. 

Similarly, Turner says that this has become more important than ever given the effects of the novel Coronavirus (Covid-19) pandemic. 

“Having an online presence is important, but having a way to interact with customers has never been more important given everything that’s happened with betting shops,” he says. “That community aspect from betting shops is something punters will be looking to find something close to online. 

“We probably understand the punter even more than the bookmaker, so we’re building our products around the people who really matter,” he adds. 

“I always liken it to having a game of golf. If you have a really good game, you’re going to come back. If you have a really bad game, you’re not just going to snap your clubs in half and give up, but you’re going to need something to come back to.”