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On 30 September 2020, the boards of bookmaker, William Hill, and US casino company, Caesars Entertainment plc, that they had come to an agreement on the terms of a recommended cash offer for the entire issued share capital of William Hill. At 272 pence per share, the offer values William Hill at £2.9 bn, an 80.7% premium to the volume-weighted average closing price of 150.54 pence per share for the three months ended 24 September 2020.

The news follows an announcement made on 25 September 2020 by William Hill that it was in receipt of two potential proposals. The first was from private equity giant Apollo Management International LLP, who had initially approached the FTSE 250 company in August. The announcement noted that William Hill had since also received a proposal from Caesars

Caesars and William Hill were already working together on a joint venture between the two, giving William Hill first rights to offer sports betting in Caesars casinos in return for a 20% stake in William Hill’s US arm. Caesars was quick to remind the board of this in its on 28 September 2020, in which it also stated that it had now included Apollo and its affiliates amongst a list of potential acquirers that, should they acquire William Hill, would give Caesars the right to terminate the joint venture. . The news of the competing bids had seen bookmaker’s shares close 43.5% higher, at 312.2 pence per share on 25 September, however, this since dropped down to 275.9 pence per share on 28 September, following Caesars announcement.

Following this announcement, the board of William Hill ‘unanimously and unconditionally’ recommended the offer to shareholders, despite analysts stating that the offer significantly undervalued the company, in light of the opportunities for growth in the US and its recovery post lockdown. This is highlighted within the company’s , which flagged that despite a 32% decline in revenue, owing to the pandemic, a ‘robust recovery in the opening weeks of the second half’, has left the company feeling confident to repay furlough funds received by the government and forgo the additional job retention bonus on offer.

Furthermore, William Hill currently has a US market share of sports wagering of 29%, which its partnership with Caesars has contributed to. The gradual legalisation of sports betting across the US, since the Supreme Court overturned a federal ruling banning the practice in 2018, has made the US a hotspot for opportunity, with William Hill anticipating  â€˜it will become the largest regulated market in the world’.  The company has continued to capitalise on these opportunities, recently announcing a multi-year deal between Caesars Entertainment and ESPN which will feature William Hill's sports betting US data and apps across ESPN platforms.

A tie-up with William Hill would therefore help Caesars cement its position in the growing US market. Commenting on the takeover, Caesars stated:

‘Caesars is excited to develop further its existing relationship with William Hill and partner with the William Hill management team to develop its offering and grow the value of the business, in particular to capitalise on the full set of opportunities presented in the US as the US gaming market goes through an unprecedented period of regulatory change, development and growth’.

In contrast, 2018 saw further restrictions for betting in the UK, with the maximum stake on ‘Fixed Odds Betting Terminals’ being limited to £2, which led to William Hill closing 713 stores in Q3 2019. Caesars’ focus is currently primarily on the opportunities available to it in the US. The company also confirmed in its announcement that it intends to work with William Hill’s management to find alternative owners for its non-US businesses.