Caesars agrees $3bn sale of William Hill International to 888
Caesars to retain all IP rights to William Hill US brand after recouping bulk of original purchase price in non-US sell-off
Caesars Entertainment has agreed to sell the William Hill International business to 888 for a total cost of $3bn (£2.2bn).
The deal effectively ends months of speculation as to the future of Hills’ non-US assets, which were put up for sale by Caesars following its own deal to acquire William Hill in April.
After the repayment of debt and other working capital adjustments, Caesars expects to receive net proceeds from the transaction of approximately $1.2bn (£835m).
Caesars CEO Tom Reeg paid tribute to Hills CEO Ulrik Bengtsson and his executive team for their “professionalism and dedication” during the sale process.
“I am delighted that, as we said we would when we announced the offer for William Hill, we have found an owner for the William Hill business outside the US which shares the same objectives, approaches, and longer-term ambitions of that business,” Reeg added.
To fund the acquisition, 888 has secured £2.2bn in debt financing from investment banks JP Morgan, Morgan Stanley, and Mediobanca, including £1.6bn in term loans and £500m in bridging loans and senior secured credit notes.
The firm has also obtained a revolving credit facility of £150m.
In addition, 888 will conduct a £500m capital raising exercise via a share rights issue, the ultimate aim of which is to create a “more beneficial” long-term capital structure for the business.
The Dalia Shaked Trust, 888’s largest shareholder with a 23% stake, has offered its unconditional support for the acquisition.
The firm has gained further backing from shareholders amounting to 24% of 888’s issued share capital, including Aberdeen Standard Investments, the firm’s largest institutional shareholder.
The 888 board of directors have also given their assent to the deal.
Pending regulatory approval, the purchase is expected to complete in the first half of 2022.
As part of the sale agreement, 888 and Caesars have agreed a separate arrangement in which Caesars will retain the intellectual property rights to the William Hill US brand in the US.
888 has agreed to not utilise any aspect of William Hill branding in the US in perpetuity, with the London-listed operator expected to continue with the development and rollout of its SI Sportsbook, which launched in Colorado earlier this week.
In addition, the two firms have committed to a transitional period of up to 24 months under which existing technology and assets being deployed by William Hill International to augment William Hill US will be transferred to Caesars’ ownership.