Churchill Downs Inc. is looking at the possibility of selling TwinSpires Racing, the official betting partner of the Kentucky Derby among other races, in a deal that could fetch them $1.5 billion.
According to a repot from Bloomberg.com, Churchill Downs is working with an adviser in a bid to gauge interest in the sports betting platform. The information however is not public and the Louisville-based gambling company has refused to comment on the issue. As of this writing, Churchill Downs is still in control of the operations of the betting company.
TwinSpires operates online sportsbooks in Arizona, Colorado, Indiana, Michigan, News Jersey, Pennsylvania and Tennessee. Moreover, it offers retail sports betting in Colorado, Indiana, Mississippi, Pennsylvania and Arizona. The brand also has online casinos in Michigan, New Jersey and Pennsylvania.
Churchill Downs Shares Went Up
Led by Chief Executive Officer Bill Carstanjen, Churchill Downs has a value of $8.8 billion. The company’s shares rose to an intraday high of $236.26 when the Bloomberg reported that the company was considering a sale of TwinSpires.
TwinSpires Horse Racing brought in an adjusted EBITDA of $31.2M in the third quarter of 2021 which was a significant 56% increase from its third quarter 2019 numbers Likewise, TwinSpires’ Horse Racing betting handle in the third quarter of 2021 rose by 56% compared to its third quarter 2019 figures.
Mergers and Acquisitions Are a Trend
The sports betting industry has boomed in the United States since the U.S. Supreme Court repealed the 1992 Professional and Amateurs Sports Protection act in 2018 which limited sports betting to the state of Nevada. As of the present, some 30 states have started legal sports betting in their respective jurisdictions with several more waiting in the wings.
Because of this, acquisitions and mergers have been heating up in the gambling industry
The most prominent merger was when Caesars Entertainment and Eldorado Resorts last year. Most recently, Penn National Gaming bought Score Media while DraftKings purchased the Golden Nugget Online Casino.