Citing that it wants to place a greater focus on both the UK and US markets, William Hill has signed a binding agreement to dispose of William Hill Australia.
The business was acquired CrownBet Holdings Pty Ltd, a wholly owned subsidiary of CrownBet which is owned by The Stars Group Inc. and a group of shareholders associated with the founder and CEO of CrownBet, Matthew Tripp, for an enterprise value of A$300m, equivalent to an equity value of A$313.7m.
Philip Bowcock, William Hill’s Chief Executive Officer, outlined that the sale places William Hill in a better position for the upcoming PASPA appeal: “We are pleased to announce the sale of William Hill Australia to CrownBet. The disposal follows a strategic review of the Business, launched in January after its profitability came under increased pressure due to the recent credit betting ban and the likely introduction of a Point of Consumption tax. The disposal will allow William Hill to focus on continuing to grow our UK Online and US businesses, particularly as we prepare for the decision on the PASPA appeal due in 2018.”
It has been clear that the UK’s second biggest bookmaker has had the intention of refraining resources from the Australian market and instead deploying them to the US market ever since it was revealed that PASPA would be appealed and there was a possibility that the US market could open up.
Already boasting a strong footprint in the US market, with retail outlets in Las Vegas, William Hill is likely to be one of the main inheritors should the US market open up.
Furthermore, the Australian market has become a less lucrative one for Hills as it announced in its Trading Statement on 15 January 2018 that the Business was undergoing a strategic review as a result of the credit betting ban in Australia and the likely introduction of a Point of Consumption tax in a number of states applying increasing pressure on the profitability of the Business.
In the year ended 26 December 2017, which was not materially affected by the credit betting ban or the introduction of new taxes, William Hill Australia had revenues of A$201m and EBITDA of A$47m. The gross assets of William Hill Australia for the year ended 26 December 2017 was approximately £133m.