Sports betting across the pond had been banned in every US state apart from Nevada since 1992, but it was legalised at the start of summer, leading to a land grab by some of the UK’s biggest bookies.
Shortly after the announcement, Paddy Power Betfair plc (LON:PPB) agreed to buy popular fantasy sports site FanDuel, while GVC Holdings PLC (LON:GVC) recently entered into a US$200mln joint venture deal with Las Vegas-based casino giant MGM.
William Hill’s alliance will see it open sportsbooks in five of Eldorado’s 21 properties across three states. That is expected to take place “within weeks” with the costs split down the middle.
In-casino bookies will then be opened in additional casinos and states in the coming months subject to legalisation in each state. Digital betting and gaming services will also be rolled out in the near future.
“Partnering with Eldorado gives William Hill access to one of the largest and most attractive casino footprints with 23mln customers across multiple states,” said William Hill chief executive Philip Bowcock.
“This partnership provides extensive cross-sell and profit growth opportunities to both parties. Together, we are positioned to capture the evolving US opportunity - starting with land-based sports betting and extending to digital sports betting and, in some states, online gaming.”
Under the terms of the agreement, which is set to run for at least 25 years, Nasdaq-listed Eldorado will receive US$50mln of William Hill shares, a 20% stake in William Hill US and a share of the profits from its licences.
The UK bookmaker already has a presence in some US states, including New Jersey, Mississippi and West Virginia, although its partnerships with casinos there have been struck on a piecemeal basis.
It has operated in Nevada for six years and said at its half-year results that it has already notched up a 31% share of the state's sports betting market.
Tough times for UK bookmakers
The push into the US comes at a time when UK gambling companies are coming under increasing pressure amid tighter government regulation and a shift to online gaming.
A crackdown on the amount which can be wagered on the lucrative fixed-odds betting terminals, dubbed the ‘crack cocaine of the betting industry’, has hung over the sector, and last month William Hill shares dropped after it reported weaker-than-expected trading in its home market.
Given the headwinds, the UK gambling sector has seen a flurry of deals in recent years. Paddy Power merged with Betfair in 2016, while Ladbrokes completed its merger with Coral a few months later.
In March of this year, GVC finalised its acquisition of the enlarged Ladbrokes Coral group, creating a betting powerhouse worth more than £5bn.