Bally’s Corporation, a leading US provider of land-based gaming and interactive entertainment, has entered into a definitive agreement to acquire Monkey Knife Fight (MKF), among the fastest-growing gaming platforms and third-largest daily fantasy sports (DFS) operator in North America.
The all-stock transaction makes Bally’s just the third sports betting company in the US to have a fantasy sports segment. In 2020, MKF, which offers its users a dynamic and creative slate of daily sports and e-sports contests, was ranked by SponsorUnited as the sixth most-searched and tenth fastest-growing brand in sports and entertainment.
Bally’s acquisition of MKF marks another step in the company’s long-term growth and diversification strategy to become the first truly vertically integrated sports betting and igaming company in the US with a B2B2C business model. It complements its recent media partnership with Sinclair Broadcast Group and its pending acquisition of Bet.Works, including its proprietary technology stack.
As part of the acquisition, MKF is set to receive immediately exercisable penny warrants to purchase up to approximately $50m in Bally’s common shares (subject to adjustment) at closing, and contingent penny warrants to purchase up to approximately $20m in additional Bally’s common shares on each of the first and second anniversaries of closing, for a possible total of up to approximately $40m.
The contingency relates to MKF’s continued operations in jurisdictions in which it operates at closing. The transaction is expected to close in the first quarter of 2021, subject to customary closing conditions.
George Papanier, President and CEO of Bally’s Corporation, said: “With this acquisition, we are pleased to enter into the high-growth DFS market. Monkey Knife Fight is a unique asset that we look forward to incorporating into Bally’s constantly growing omnichannel portfolio of land-based casinos and igaming platforms.
“As with all of the properties and services that fall under the iconic Bally’s brand, we are committed to providing a best-in-class DFS platform to sports fans around the country.”
With approximately 180,000 registered users and 80,000 depositing players, MKF’s distinctive, user-friendly gaming platform will become an integral component of the ‘Bally’s Interactive’ division, as well as contribute to the company’s growing player database.
The gaming platform will support Bally’s plans to develop a potential sports bettors database in states such as California, Florida and Texas, which are expected to account for 20-25% of US sports betting revenues. It will also enable the company to build a player database in Canada, a market that is expected to authorize sports betting soon.
The acquisition will lead to Bally’s developing new and engaging content with MKF for its customers.
Papanier continued: “The MKF acquisition will allow Bally’s to leverage both its current customer database as well as DFS’s collection of depositing players. These assets will also provide Bally’s with a significant advantage in launching its own B2C sports betting operations.”
Bally’s intends to combine MKF’s expansive geographic presence, which spans 37 states, the District of Columbia, and Canada, with Sinclair’s significant media footprint, including its portfolio of 21 regional sports networks, to engage sports fans across the US by providing unique DFS offerings.
Bill Asher, Founder and CEO of Monkey Knife Fight, added: “Since our inception, we have distinguished ourselves from competitors by providing the best experiences for our valued players, forming strategic partnerships with teams, ownership groups and players unions, and acquiring strategic assets to bolster our position in the market.
“I am immensely proud of all we have accomplished over the past three years at MKF and am confident that the talented Bally’s team has what it takes to continue to grow and develop what is already a great business.”