GVC & MGM To Form Deal Leading To Potential Merger
GVC Holdings the parent company of Ladbrokes Coral, Sportingbet and Partypoker along with several others are in advanced talks over a joint venture with MGM Resorts to offer online betting and other gambling services across the US.
The deal is said to be worth around $200 million for GVC Holdings with one of the world’s largest casino operators and could eventually turn into a merger of the two companies further down the line.
It is understood the deal will be officially announced later in the week and will consist of a commitment of 25 years each to the tie-up and an option of extending for another 10 years.
“Discussions are at an advanced stage and will update the market when appropriate,” a GVC spokesman said.
Sky News broke the story quoting insiders close to the deal and is a major coup for Chief Executive of GVC Kenny Alexander. With the deal to acquire Ladbrokes Coral only just completed and with the FIFA World Cup boosting business for GVC this latest announcement is good news for investors.
GVC is valued at around $8.2 billion and with MGM worth $17 billion any future merger would make MGM the controlling stake holder. With the US only at the start of opening up sports betting legally in the states this marks a huge intention for both MGM and GVC to be at the forefront once sports betting opens up in the US.
This latest development will put pressure on competitors Paddy Power Betfair and William Hill to seek long term partnerships with US Casino operators and for certain announcements like the GVC deal will not be the last one.
