GVC and MGM increase investment in Roar Digital JV to $450m
Joint venture confirms US brand on track to generate $130m New Jersey revenue with “rapid growth” when US sport resumes
Roar Digital shareholders have committed to a second round of investment totalling $450m as the brand seeks to soak up market share in the US.
The increase follows an initial commitment of $200m from joint venture owners GVC Holdings and MGM Resorts International. With this second round of investment in the business, the company has total investable capital of $370m.
Roar Digital revealed its BetMGM brand is on track to generate more than $130m in net revenue for 2020, predominantly from online gaming operations in the New Jersey market.
“With the return of sports and our growing operations across the US, we anticipate rapid growth in the coming year,” Roar Digital CEO Adam Greenblatt said in a statement to company shareholders.
Since its launch in 2018, Roar has secured market access to 19 states, reaching approximately 50% of the US population. It has active operations in seven states, with four more expected to launch by the end of 2020. The firm enjoys an 18% market share in the New Jersey online gaming market and has achieved record 210% year-on-year revenue growth in Q2.
$MGM-$GVC pour another $250mm into ROAR. $FLTR recently raises £812mm, much of which will be plowed into U.S. expansion. $DKNG has easy access to capital. Perhaps the U.S. online #sportsbetting market will eventually be won by product. For now, though, it will be won by money.
— Chris Krafcik (@ckrafcik) July 8, 2020
As part of the further expansion of the BetMGM business, M life Rewards, MGM Resort’s loyalty programme, will be launched on the BetMGM platform by the end of 2020.
Existing BetMGM customers will become M life members with the ability to earn tier status, recognition and rewards based on their sports bets and online casino stakes.
Addressing Roar’s expansion plan, Greenblatt added: “With broad market access secured, our long-term technology foundations now firmly established, and a high performing team in place, this further unequivocal support from our two shareholders will ensure we can achieve leading market positions in this exciting industry that is growing even faster than our initial expectations.”
GVC CEO Kenny Alexander welcomed the further investment round as “exciting times” for the business as it looks to build on initial growth.
“We see enormous potential for the US market and are delighted to have such a strong foothold in it through our partnership with MGM Resorts,” said Alexander.
“Our stake in BetMGM is, by some distance, the most important and exciting investment that GVC has ever made.
“We are absolutely committed to ensuring that the company has the funding and technical resources needed to achieve long-term market leadership, while delivering significant value for shareholders.”
GVC CEO Kenny Alexander
Taking an even more bullish approach on an investor call with analysts, Alexander added: “This is a statement of intent. The kid gloves are coming off. We’re certainly not going to settle for second or third place in the US.”