Caesars $3.7 billion acquisition of William Hill is finally on the home straight.
The High Court of Justice in England and Wales approved the deal on Tuesday, the companies said. The court approval was needed after merger arbitrageurs disputed the sale.
HBK Capital Management and fellow US hedge fund GWM Asset Management argued the William Hill board unfairly downplayed the chances of a rival bid.
But the court dismissed that argument. The deal is now set to close and William Hill to delist in the UK by Thursday.
How did the market react to Caesars deal closing?
Interestingly, Hills’ share price dipped 2% on the news to the offer price at 272p ($3.79.)
That meant investors anticipated at least some chance of the deal being rejected and then a higher offer being made.
Caesars stock climbed 0.8% initially Tuesday, but was down 2% on the day at the time of writing amid a wider market selloff.
What next for Caesars and William Hill?
Jefferies analyst David Katz said in a note the transaction was a “strong positive for [Caesars] both strategically and financially.”
Caesars previously said the merger would help its product in several ways including:
- A unified wallet and customer experience across William Hill online sportsbooks and Caesars online casinos.
- The chance for William Hill to cross-sell to 60 million customers in Caesars Rewards database.
- Proprietary US sports betting tech and industry expertise.
A move for the future
Indeed, Caesars has been positioning itself as a major player in US sports betting. It is an official partner of the NFL and will also sponsor the New Orleans Saints’ Superdome.
Of course, the tie-up may not end the M&A party for Caesars.
Some analysts think the company will spin out the combined online betting and gaming business and list it in the US. Such a company could generate $600-$700 million in pro forma net revenue in FY2021.
