William Hill shares jumped 32% in London today as the bookmaker confirmed it has received multiple cash buyout offers from US companies.
William Hill released a note indicating offers from casino giant Caesars Entertainment and New York investment firm Apollo Management International.
Hill said it received an initial proposal from Apollo on Aug. 27, before a further proposal from Apollo and proposals from Caesars.
“Discussions between William Hill and the respective parties are ongoing,” the company said. “There can be no certainty that any offer for William Hill will be made, nor as to the terms on which any offer might be made.”
Under M&A regulations, Caesars and Apollo now have 28 days to announce a firm offer for William Hill or announce they do not intend to make an offer.
William Hill shares jumped 32% to 288 pence on the news, valuing the company at around $4 billion.
William Hill M&A speculation
The announcement was sparked by a Bloomberg report today that William Hill had been approached by Apollo.
The Caesars interest has also been making the rounds in the industry. Multiple analysts noted this week that Hills and Caesars could form a US joint venture including the William Hill US assets.
Roth Capital analyst David Bain said a CZR/WMH interactive spinoff was likely to happen this year, “well-ahead of investor expectations”.
The US betting business would likely receive a valuation bump simply by moving to US equity markets. It would also benefit from being separated from the rest of the European and UK business.
Caesars already owns 20% of William Hill US, while Hill manages the Caesars betting operations.
More on William Hill in the US
William Hill offers online sports betting in six states:
- New Jersey
- West Virginia
It also powers the Rhode Island Lottery app’s trading services, in addition to retail sportsbooks in additional states.
William Hill also restructured its UK operation earlier this year. The company combined online and retail into one division that could feasibly make it easier to sell-off.