Endeavor Group Holdings, the owners of the Ultimate Fighting Championship, announced on Monday that it will be purchasing the sports betting company OpenBet from the Scientific Games Corp. for $1.2B in cash and stock.
Said Endeavor CEO Ariel Emmanuel in a Statement:
“This capability set is the ideal complement to our IMG ARENA sports betting business, which works directly with sports rights holders. We look forward to growing these businesses together to capitalize on the strong secular tailwinds in the sports betting ecosystem.”
Focus on Becoming a Gaming and Digital Content Provider
According to Endeavor, the acquisition will strengthen its position in the sports betting industry. The company said it plans to merge OpenBet with its existing sports betting business IMG Arena.The deal is expected to be completed in the second quarter of 2022 and will be paid with $1B in cash and $200 million worth of Endeavor Class A common stock.
Scientific Games previously disclosed its plan to sell its lottery and sports betting businesses to focus on becoming a gaming and digital content provider. Oakvale Capital and Macquarie Capital were the advisers of the Las Vegas-based major slot machine maker.
Online Gambling Industry Expanding Exponentially
The acquisition comes at a time when the online gambling industry in the United States continues to expand exponentially since the U.S. Supreme Court repealed the 1992 Professional and Amateur Sports Protection Act in 2018. Online gambling was further boosted by the temporary closure of casinos and betting shops during the height of the COVID-19 pandemic in 2020. .
Last week, British gambling company Entain revealed that it received a takeover proposal from American fantasy sports betting company DraftKings in the amount of $22.4B.