William Hill sells Australian business to CrownBet
British betting operator William Hill has confirmed the sale of its Australian division to Crownbet holdings for an enterprise value of AU $300m.
William Hill announced the sale on Tuesday to CrownBet and shareholders associated with Matthew Tripp, the founder of CrownBet. The equity value of the sale is AU $313.7m.
CrownBet have beaten off competition from bet365, Ladbrokes, and Paddy Power Betfair, with the latter going head to head with CrownBet for the bidding since last week.
The sale ends William Hill’s time in Australia which began in 2012 after the bookmaker acquired SportingBet and tomwaterhouse.com.
The bookmaker’s time in Australia was hindered by regulatory changes eventually leading to a strategic review of the business being announced in January. This culminated in a write down to the value of £238m last month, with the bookmaker recording a £75m pre-tax loss in 2017 largely due to its troubles down under.
Commenting on the sale, Philip Bowcock, chief executive officer of William Hill, said:
We are pleased to announce the sale of William Hill Australia to CrownBet. The disposal follows a strategic review of the Business, launched in January after its profitability came under increased pressure due to the recent credit betting ban and the likely introduction of a Point of Consumption tax. The disposal will allow William Hill to focus on continuing to grow our UK Online and US businesses, particularly as we prepare for the decision on the PASPA appeal due in 2018.– Philip Bowcock, Chief executive officer at William Hill
Stars Group acquired majority stake in CrownBet
CrownBet’s acquisition of William Hill comes just days after the Stars Group acquired a 62% stake in CrownBet. That deal cost the Stars Group around £84m but is particularly valuable for the group, who now hold majority shares in firms with around a 20% share of the market in Australia.
However, as part of the transaction deal for the purchase of William Hill Australia, The Stars Group announced it had increased its stake in CrownBet to 80%, spending another £58m in the process.
An exit from the market has been viewed as the only really sensible move for Hill to make. The credit betting ban effected last month damaged Hill more than other operators, as they took a larger volume of credit or leveraged bets.
Despite Hill’s troubles, CrownBet has flourished and is one of the fastest growing online sports betting sites in the country. With stricter regulation, consolidation and scaling up is a smart move and should enable CrownBet to continue to perform well.