Endeavor Group Holding (EDR) strengthens its betting position by acquiring Scientific Games Corp (SGMS). It "only" cost $1.2b — well, $1b in cash and $200k in stocks, that is. Endeavor will combine Scientific Game's Open Bet with its existing sports betting subsidiary IMG Arena. After the news broke, Endeavor's shares jumped 10%. The deal is set to be sealed in the second quarter of 2022.
Endeavor's acquisition will enable the company to strengthen and consolidate its position in the US sports betting industry. The decision comes as there has been a significant increase in the rise of online sports betting during the Covid-19 pandemic.
Why it matters
Just three years ago, online sports betting was illegal in the US. Now, 26 states allow it — up from 18 states last year. The booming industry expects more states to join in, and companies are looking for deals to consolidate the market. Aside from this deal, British gambling firm Entain (ENT) recently received a $22.4b purchase offer from Drafkings (DKNG).
