Scale acquisitions in Australia
Australia is an attractive opportunity given the appetite for betting and a relatively open regulatory environment. The structural trends – online, mobile, fixed odds betting and sports betting – also play into William Hill’s core strengths.
Individual market circumstances made a compelling case for a scale acquisition. First, this is already a very consolidated market, with around 70% of turnover concentrated in three major operators – Tabcorp, Sportsbet (owned by Paddy Power) and now William Hill Australia. Second, it’s getting more competitive, both with new entrants and with customers becoming more savvy. Third, costs are going up, including payments to the racing industry.
William Hill has a great opportunity in Australia. Owning our technology gives us much more flexibility than the competitors. Leveraging the wider Group resources means we can run a very efficient operation and we can benefit from tried and trusted innovations from Online. Moving quickly is critical and buying at scale puts us in a great position to make the most of those assets.
Building optionality in the US
William Hill US was created through the acquisition and consolidation of three sub-scale operators into a broader business. Today, it is a small but important part of the Group, having benefited from the William Hill brand, product range and investment to become a growing and increasingly profitable division.
Its significance is far in advance of its scale today, though, as this business gives us a platform from which to take advantage of regulatory change in the US. While it remains unclear as to what form that change will take or over what time-frame, we have focused on creating optionality. This comes from William Hill having an established and recognised brand name, a licensed operation – with all the trust and confidence that comes from having undergone such rigorous probity checks – and being part of the ongoing dialogue about the potential for regulation of online gaming or land-based and/or digital sports betting.