Caesars makes offer to buy William Hill
Underwrites public offering of 30,000,000 shares to fund cash payment
Caesars Entertainment says it is in advanced talks to buy William Hill for GBP2.9 billion ($3.7 billion) to position itself to take full advantage of the expanding U.S. sports betting market.
Dated Sept. 28, 2020, Caesars Entertainment, Inc. (NASDAQ: CZR) announced that, “it has commenced an underwritten public offering of 30,000,000 shares of its common stock. In connection with the offering, the company intends to grant the underwriters a 30-day option to purchase up to an additional 4,500,000 shares of its common stock. The company expects to use the net proceeds from the offering for general corporate purposes, including, potentially, the previously announced possible cash offer for the entire issued and to be issued share capital of William Hill plc.”
In a filing to the Securities and Exchange Commission, Caesars said the cash offer would value each William Hill share at 272 pence, representing a 25 percent premium to the closing price on Sept. 24, the day prior to the commencement of the offer period.
The company press release added: “Caesars believes that the sports betting and online gaming sector represents one of the largest areas of growth in the US gaming industry, with some analysts recently estimating a potential total addressable market size ranging up to US$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 the U.K. company currently have a joint venture in the U.S., which is 20 percent-owned by the U.S. operator. The company said the structure needs to be broadened in scope to maximise the opportunities and provide the best consumer experience.
