MGM Resorts has been dealing with major revenue losses over the past ten months. Interestingly, this company has been recently working hard to break into the country’s quickly-expanding sports betting industry. We’re now beginning to hear more about the proposed deal between MGM Resorts and Entain.
Entain, formally known as GVC Holdings, is one of the most powerful sports betting companies in the world. MGM Resorts is currently making bids to take this company over. Today, we’ll talk about what needs to be done for this deal to go through.
Let’s check it out.
More Managers With MGM Resorts Have Just Been Furloughed
Back in March of 2020, something happened to the US casino industry that almost no one saw coming. All land-based casinos around the United States completely closed down to the public. That includes all of the casino-resorts on the Las Vegas Strip.
Casino companies didn’t know how to respond to these new regulations. Major casino officials immediately began talking with state leaders about how to get things back up and running. It wasn’t until June that the gambling venues in Las Vegas were given permission to reopen again.
Simply reopening didn’t prove to be a quick fix. The casinos in Las Vegas continue to see massive drops in their monthly visitation rates. As a result, many casino companies began shifting their hours to deal with the lack of guests.
MGM Resorts is still seeing drops in revenue. As a result, the company has just furloughed 140 of its managers in the Las Vegas area. You can read a company statement about this news below.
“Business volumes are projected to remain low for the beginning of the year due to the pandemic, unfortunately requiring temporary reductions in staffing across our Las Vegas properties. We are focused on bringing employees back to work when business levels recover. We are optimistic that, with vaccine distribution and other developments, we will return to higher business levels and staffing soon,” the statement said. “As before, impacted employees with MGM Resorts health plans remain eligible for benefits and continue to have access to the MGM Employee Grant Fund and access to MGM’s employee resources and training.”
It’s tough news for the workers affected by these new furloughs. Hopefully, MGM Resorts is able to bring them back over the next couple of months. In the meantime, the company seems focused on expanding its sports betting operations.
MGM Resorts and Entain Continue to Discuss Major Deal
For years, MGM Resorts has been working to offer more sports gambling options. This company now operates land-based and online sportsbooks in many areas around the country. The sports betting industry is now proving to be profitable while casino operations are struggling.
Recently, news came out that MGM Resorts was interested in taking over Entain. As many know, Entain operates several of the most powerful sports betting brands in the world including Bwin, Coral, and Ladbrokes. MGM would secure a legitimate hold over the sports betting industry by acquiring this company.
Reports claim that MGM offered an astounding $11 billion stock offer to take over the company. Officials within Entain claimed this offer “significantly undervalued the company.” MGM Resorts then began openly considering adding cash to the offer.
A new report claims that Barry Diller’s IAC/InterActiveCorp, MGM Resorts’ biggest shareholder, has pledged up to $1 billion to help with the acquisition of this company.
“The future of gaming will be omnichannel,” IAC said in a statement. “The long-term winners in global gaming will deliver customers compelling digital and physical experiences under one brand and loyalty program.”
MGM Resorts isn’t the only company to focus on sports betting expansion. Not long ago, Caesars Entertainment agreed to pay $3.7 billion to acquire William Hill. This gives Caesars a huge control over the country’s regulated sports betting industry. We’ll continue offering updates on the deal between MGM Resorts and Entain over the next few months.
2021 is Expected to be a Huge Year for the US Sports Betting Industry
The past ten months have been the most difficult in history for US casino companies. Amazingly, things have still not recovered and even the top analysts are having a difficult time predicting when land-based casinos will begin seeing 2019-level revenue figures. The US sports betting industry, however, has been hugely successful lately.
That’s great news for the states with regulated sports betting options available. Places like New Jersey, Delaware, and Colorado are seeing a significant amount of money coming in from this industry. Many now predict that 2021 will be an even bigger year for sports betting operators.
26 states have formally passed bills to regulate sports betting. Several more are expected to do so this year. Many now believe that nearly every state will have at least some form of legalized sports betting available by 2025.
Casino companies are doing everything they can to take advantage of this emerging industry. MGM Resorts and Entain are now looking towards a merger. As we just mentioned, Caesars Entertainment has already acquired one of the world’s biggest sports betting companies.
It will be fascinating to see how this industry evolves. With land-based casino revenue low, more gaming companies will look towards sports betting as a valuable source of revenue.
Do you think we’ll see MGM Resorts take over Entain this year? Let us know in the comments section below!