The summer months may be somewhat of a lull for the US sporting calendar with the majority of leagues in the off-season period, but it didn’t represent a pause in the sports betting industry movements.
May and June saw several states working towards passing sports betting legislation and laying the groundwork for future launches. The early summer also saw MGM Resorts seek to expand its business both online and through land-based casinos, securing two big pieces of M&A activity.
Kansas and Maine legalize sports betting
Maine and Kansas became the 34th and 35th US states to legalize sports betting when Governors Janet Mills and Laura Kelly put pen to paper on bills in their respective states.
The Maine bill set out that tribes have the exclusive right to provide online wagering whilst casinos can provide in-person sports betting. The tribes can either choose to operate their own sportsbook or sign an agreement with any online/mobile sportsbook provider, so long as they secure regulatory approval.
The bill stipulates a tax rate of 10% on revenue, with a four-year mobile deal constant of just $200,000.
Kansas also imposed a 10% tax rate, with the bill passing in the state Senate by 21-13 on May 12.
“Legalizing sports betting will bring more revenue to our state and grow our economy,” commented Gov. Kelly. “This is another mechanism that casinos, restaurants, and other entertainment venues can now utilize to attract Kansans to their establishments.”
The provisions include a 2% problem gambling and addictions grant fund, which would be due on July 1 each year to support tools such as a helpline with text and chat capabilities and RET provisions.
MGM makes M&A moves
The summer proved to be a busy period for MGM Resorts International, which made two moves in a bid to expand its business across the US and beyond.
Firstly, MGM made a $607m offer to the board of Swedish operator LeoVegas to acquire its online casino and sports betting business, expanding the firm into Europe.
Offering a 44.1% premium on the share closing price at the time, MGM declared that the acquisition was down to pursuing a strategic opportunity to accelerate growth and product offerings outside of the US; the presence of an experienced online gaming management team and superior technology capabilities; and a commitment to continued profitable growth.
CEO & President Bill Hornbuckle explained: “Our vision is to be the world’s premier gaming entertainment company, and this strategic opportunity with LeoVegas will allow us to continue to grow our reach throughout the world.”
Secondly, MGM completed its $1.625bn acquisition of The Cosmopolitan of Las Vegas as it continued to grow its presence on the Strip.
Expanding its casino offering in Las Vegas, the firm agreed to a 30-year lease with an annual rent payment of $200m for the building which houses the $1.1bn net annual revenue company.
Hornbuckle commented: “The Cosmopolitan of Las Vegas has already established itself as one of the Strip’s premier resorts with an iconic brand, well-curated experiences, and a loyal customer base. We couldn’t be more excited to bring them into our portfolio of world-class operations.”