RENO, Nev. and
LAS VEGAS, Sept. 30, 2020 /PRNewswire/ -- Caesars
Entertainment, Inc. (NASDAQ: CZR) ("Caesars") and
William Hill PLC (LSE: WMH) ("William Hill") are
pleased to announce today that they have reached agreement on the
terms of a recommended cash acquisition pursuant to which Caesars
will acquire the entire issued and to be issued share capital of
William Hill for approximately £2.9 billion (the
"Acquisition"). The historic acquisition would bring
together Caesars as one of the largest gaming-entertainment
companies in the U.S. and one of the world's most diversified
gaming entertainment provisions, and William Hill as one of the
world's leading betting and gambling companies. The Acquisition is
subject to anti-trust and regulatory approvals and completion is
expected to take place in the second half of 2021.
"The opportunity to combine our land based-casinos, sports
betting and online gaming in the U.S. is a truly exciting
prospect," said Caesars Entertainment CEO Tom Reeg. "William Hill's sports betting
expertise will complement Caesars' current offering, enabling the
combined group to serve our customers in the fast-growing U.S.
sports betting and online market. We look forward to working with
William Hill to support future growth in the U.S. by providing our
customers with a superior and comprehensive experience across all
areas of gaming, sports betting, and entertainment."
"The William Hill Board believes this is the best option for
William Hill at an attractive price for shareholders," said
Roger Devlin, Chairman of William
Hill, commenting on the Acquisition. "It recognizes the
significant progress the William Hill Group has made over the last
18 months, as well as the risk and significant investment required
to maximize the U.S. opportunity given intense competition in the
U.S. and the potential for regulatory disruption in the U.K. and
Europe."
"Under the revitalized senior leadership team, William Hill has
been delivering on its strategy and potential. William Hill is one
of the world's leading betting and gambling companies, with a long
and proud heritage. It is one of the most recognized brands
globally. Over recent years, it has transformed from a business
once heavily reliant on U.K. retail into a company that is truly
diversified by geography and channel, providing a stable standalone
platform for future growth."
"For now, it is very much business as usual. Employees will be
kept fully informed through this process. In terms of our U.K. and
International businesses, we believe they have a strong future
ahead and we will work with Caesars to find suitable partners to
further the long-term growth prospects of these businesses."
Compelling Strategic Rationale
- Caesars believes that the sports betting and online gaming
sector represents one of the largest areas of growth in the U.S.
gaming industry, with some analysts recently estimating a potential
total addressable market size ranging up to $30-35 billion, reflecting the acceleration of
gaming legislation at the state level, the increased adoption by
consumers as gaming becomes more available and continued
integration with national sports and media brands.
- Caesars and William Hill currently operate a U.S. joint venture
with 20% and 80% equity ownership respectively. Through this joint
venture, William Hill runs online sports betting operations through
Caesars' market access in each state and retail sports betting
operations in Caesars' properties as well as those of other casino
operators around the United
States. Caesars owns and operates 54 domestic properties in
16 states. The company's resorts operate primarily under the
Caesars, Harrah's, Horseshoe and Eldorado brand names.
- Caesars believes that the current joint venture structure
between Caesars and William Hill in the U.S. needs to be broadened
in scope in order to fully maximize the opportunity in the sports
betting and gaming sector and provide the best possible customer
experience.
- Caesars believes that a combination of Caesars and William Hill
represents a compelling opportunity to improve the offering and
experience for the customer:
-
- The combined company would be able to utilize the expertise and
assets contained in both companies to better serve customers in the
highly competitive online gaming and sports betting space
throughout the U.S. The combined company's market access across the
U.S. would be increased and would benefit from a broad network of
sports books locations.
- The combined company would provide a more unified customer
experience by consolidating applications and wallets, and by
allowing a more focused branding experience.
- The combined company would have a world-class portfolio of
assets and brands, including William Hill's sports betting
expertise, as well as its established technology program and
roadmap (including its highly regarded scalable and secure Liberty
Technology platform).
- The combined company will also be afforded the ability to
access Caesars' extensive and pre-existing relationships with
dozens of sports teams and events including being the Exclusive
Casino Sponsor of the NFL.
- Caesars believes that it is important to align with media
companies to enhance customer acquisition and generate excitement
and loyalty across multiple products. Currently, Caesars has a
multi-year relationship with ESPN, and William Hill has a
relationship with CBS Sports.
- Finally, as part of the combined company William Hill would be
afforded new and complete access to Caesars' brand and highly
regarded loyalty program (which had approximately 60 million
members at the end of 2019), which it currently does not have.
Caesars believes this synergistic relationship will benefit all
customers with integrated benefits across various elements of
gaming and entertainment, allowing customers to earn tier status
and Caesars Rewards that can be used at all of Caesars' land-based
and online properties, helping to improve customer experience,
reducing churn and increasing customer wallet share.
Together with iGaming, which is currently outside the scope of
the joint venture, Caesars expects that the enlarged sports and
online gaming business in the U.S. could generate between
US$600-US$700
million in net revenue in FY2021 (on a pro-forma basis).
Caesars' strategic focus remains on the opportunities
immediately evident in the U.S. market at this stage. It believes
in the compelling proposition that William Hill's presence in the
U.K. and other non-U.S. international markets offers to their
gaming customers in those markets and believes those businesses
have a strong future. In order to best maximize those propositions
and support those businesses' long-term ambitions following
completion of the Acquisition, Caesars' intention is to seek
suitable partners or owners who have aligned objectives and
approaches, and who will be focused on the longer-term ambitions of
those businesses and for the benefit of its customers.
Summary of Acquisition
- The boards of William Hill, Caesars and Caesars UK Holdings
Limited ("Caesars UK Bidco") have reached agreement on the
terms of a recommended cash acquisition pursuant to which Caesars
UK Bidco shall acquire the entire issued and to be issued share
capital of William Hill. The Acquisition is to be effected by means
of a scheme of arrangement under Part 26 of the Companies Act.
- The Acquisition values the entire issued and to be issued share
capital of William Hill at approximately £2.9 billion.
- Under the terms of the Acquisition, William Hill Shareholders
shall be entitled to receive:
for each William Hill Share:
272 pence in cash
representing
a premium of approximately:
-
- 57.6 per cent. to the Closing Price per William Hill Share of 172.55 pence on 1
September 2020 (being the last Business Day before Caesars'
first approach to William Hill);
- 80.7 per cent. to the volume weighted average closing price per
William Hill Share of 150.54 pence for the three months ended
24 September 2020 (being the last
Business Day prior to the commencement of the offer period);
- 112.5 per cent. to the Placing price of 128 pence per William
Hill Share on 17 June 2020;
and
- 25.0 per cent. to the Closing Price per William Hill Share of 217.60 pence on 24
September 2020.
- The Acquisition is conditional on, amongst other things, the
approval of William Hill shareholders.
- The Acquisition shall be put to William Hill Shareholders at
the Court Meeting and at the General Meeting. In order to become
effective, the Scheme must be approved by a majority in number of
the William Hill Shareholders voting at the Court Meeting, either
in person or by proxy, representing at least 75 per cent. in value
of the William Hill Shares voted. In addition, a special resolution
implementing the Scheme must be passed by William Hill Shareholders
representing at least 75 per cent. of votes cast at the General
Meeting.
- The Scheme Document, containing further information about the
Acquisition and notices of the Court Meeting and the General
Meeting shall be published in due course.
About Caesars Entertainment, Inc.
Caesars
Entertainment, Inc. is one of the largest gaming-entertainment
companies in the U.S. and one of the world's most diversified
gaming-entertainment providers. Since its beginning in Reno, Nevada, in 1937, Caesars Entertainment
has grown through development of new resorts, expansions and
acquisitions. Caesars Entertainment's resorts operate primarily
under the Caesars®, Harrah's®, Horseshoe® and Eldorado® brand
names. Caesars Entertainment offers diversified amenities and
one-of-a-kind destinations, with a focus on building loyalty and
value with its guests through a unique combination of impeccable
service, operational excellence and technology leadership. Caesars
Entertainment is committed to its employees, suppliers, communities
and the environment through its PEOPLE PLANET PLAY framework. For
more information, please visit www.caesars.com/corporate.
About William Hill
William Hill PLC is now one of the
world's leading betting and gaming companies, employing over 16,000
people. Its origins are in the UK where it was founded in 1934, and
where the company is listed on the London Stock Exchange. With
headquarters in London and
Leeds it has a national presence
of licensed betting offices in Great
Britain and Northern
Ireland and is one of the country's leading online betting
and gaming services. In 2012, it established William Hill US with a
focus on retail and mobile operations in Nevada, which is now the largest sports
betting business in the USA.
William Hill US (www.williamhill.us) currently operates 113 race
and sports books in Nevada and the
state's leading mobile sports betting app. William Hill is
operating in New Jersey at
Monmouth Park Racetrack, Ocean Resort Casino, Tropicana Atlantic
City, and online with the William Hill New Jersey sports betting
app as well as in Indiana,
Iowa, and West Virginia. William Hill is a licensed
sports betting provider in numerous casinos in Mississippi, Pennsylvania, Rhode
Island, and New Mexico, and
serves as the exclusive risk manager for the sports lottery in
Delaware. William Hill has
licensed operations in The Bahamas, Italy, Spain
and Sweden and serves online
customers in the UK, Ireland and
throughout the world from its digital hubs in Gibraltar and Malta. William Hill's acquisition of Mr Green
in January 2019, in line with its
strategy to diversify internationally, significantly expanded its
European footprint, and provided an established hub in Malta from which to continue to grow the
international business.
Forward-Looking Statements
This
announcement (including information incorporated by reference in
this announcement), oral statements made regarding the Acquisition,
and other information published by William Hill, any member of the
William Hill group (the "William Hill Group"), Caesars,
Caesars UK Bidco or any member of the Caesars group (the
"Caesars Group") contain statements which are, or may be
deemed to be, "forward looking statements". Such forward looking
statements are prospective in nature and are not based on
historical facts, but rather on current expectations and on
numerous assumptions regarding the business strategies and the
environment in which William Hill, any member of the William Hill
Group, Caesars, Caesars UK Bidco, any member of the Caesars Group
or the combined William Hill Group and Caesars Group's (the
"Enlarged Group") shall operate in the future and are
subject to risks and uncertainties that could cause actual results
to differ materially from those expressed or implied by those
statements.
The forward-looking statements contained in this announcement
may relate to William Hill, any member of the William Hill Group,
Caesars, Caesars UK Bidco or any member of the Caesars Group or the
Enlarged Group's future prospects, developments and business
strategies, the expected timing and scope of the Acquisition and
other statements other than historical facts. In some cases, these
forward looking statements can be identified by the use of forward
looking terminology, including the terms "believes", "estimates",
"will look to", "would look to", "plans", "prepares",
"anticipates", "expects", "is expected to", "is subject to",
"budget", "scheduled", "forecasts", "synergy", "strategy", "goal",
"cost-saving", "projects" "intends", "may", "will", "shall" or
"should" or their negatives or other variations or comparable
terminology. Forward-looking statements may include statements
relating to the following: (i) future capital expenditures,
expenses, revenues, earnings, synergies, economic performance,
indebtedness, financial condition, dividend policy, losses and
future prospects; (ii) business and management strategies and the
expansion and growth of William Hill, any member of the William
Hill Group, Caesars, Caesars UK Bidco or any member of the Caesars
Group's operations and potential synergies resulting from the
Acquisition; and (iii) the effects of global economic conditions
and governmental regulation on William Hill, any member of the
William Hill Group, Caesars, Caesars UK Bidco or any member of the
Caesars Group's business.
By their nature, forward-looking statements involve risk and
uncertainty because they relate to events and depend on
circumstances that shall occur in the future. These events and
circumstances include changes in the global, political, economic,
business, competitive, market and regulatory forces, future
exchange and interest rates, changes in tax rates and future
business combinations or disposals. If any one or more of these
risks or uncertainties materializes or if any one or more of the
assumptions prove incorrect, actual results may differ materially
from those expected, estimated or projected. Such forward looking
statements should therefore be construed in the light of such
factors.
None of William Hill, any member of the William Hill Group,
Caesars, Caesars UK Bidco or any member of the Caesars Group, nor
any of their respective associates or directors, officers or
advisers, provides any representation, assurance or guarantee that
the occurrence of the events expressed or implied in any
forward-looking statements in this announcement shall actually
occur. Given these risks and uncertainties, potential investors
should not place any reliance on forward looking
statements.
Specifically, statements of estimated cost savings and
synergies relate to future actions and circumstances which, by
their nature involve, risks, uncertainties and contingencies. As a
result, the cost savings and synergies referred to may not be
achieved, may be achieved later or sooner than estimated, or those
achieved could be materially different from those estimated. Due to
the scale of the Enlarged Group, there may be additional changes to
the Enlarged Group's operations. As a result, and given the fact
that the changes relate to the future, the resulting cost synergies
may be materially greater or less than those estimated.
The forward-looking statements speak only at the date of this
announcement. All subsequent oral or written forward-looking
statements attributable to William Hill, any member of the William
Hill Group, Caesars, Caesars UK Bidco or any member of the Caesars
Group, or any of their respective associates, directors, officers,
employees or advisers, are expressly qualified in their entirety by
the cautionary statement above.
William Hill, each member of the William Hill Group, Caesars,
Caesars UK Bidco and each member of the Caesars Group expressly
disclaim any obligation to update such statements other than as
required by law or by the rules of any competent regulatory
authority, whether as a result of new information, future events or
otherwise.
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SOURCE Caesars Entertainment, Inc.