MGM Resorts International and Caesars Entertainment appear to be digging their foothold into the new US-based sports betting market. The two casino enterprises have recently agreed to a string of partnerships that will help facilitate their land-based and online betting platforms in multiple states. With these moves, both MGM and Caesars could be circling an early monopoly.
MGM made a deal with GVC Holdings, the owner of the UK based betting company Ladbrokes. The plan is to develop a sports betting and online gambling platform fit for US consumption. This includes the development of a mobile-friendly app and websites with odds, fixtures, highlights, etc. Another separate MGM agreement with Boyd Gaming Corporation will facilitate both companies opening land-based and online sports wagering options in 15 states where they have brick-and-mortar casino locations.
Caesars partnered with Scientific Games for their New Jersey and Mississippi locations. Sports betting in New Jersey has already opened and Mississippi legislators recently gave the green light for legal wagering. For NJ, Caesars owns three Atlantic City casinos. Two of their holdings, Bally’s and Harrah’s, have built temporary brick-and-mortar sportsbooks to be operated by Scientific Games. SG will also develop a mobile platform. In Mississippi, the same will happen with Horseshoe Tunica and Harrah’s Gulf Coast.
Between these two deals, MGM’s is more lucrative. It is reported that both sides of the deal (MGM and GVC) will be investing upwards of $100 million for a 25-year partnership. It is possible that this deal leads to an eventual merger between the two companies, thus forming a major sports betting conglomerate in the United States. GVC owns PartyPoker, Bwin, Sportingbet and Ladbrokes/Coral. MGM has 13 properties in Las Vegas alone plus casinos in Maryland, Mississippi, Michigan, and New Jersey. They are expanding to New York and Massachusetts as well.
From a financial investment standpoint, MGM’s deal is exciting for the future. Deutsche Bank Analyst Carlo Santarelli spoke on the partnership as a “net positive” for both companies. He said it will help both companies’ speed to market as they enter into this new domestic sports betting trade. Some of the increased traffic for these new brick-and-mortar sportsbooks will likely trickle down to other casino arenas like table games, slots, and poker, meaning it is a win-win for any existing land-based gambling operation.
With more and more states pushing out new legislation on sports betting, deals like these help cement companies’ place in the emerging sports gambling market. The US is set for a complete overhaul with their gambling options, so companies like MGM and Caesars are smart to establish an early grip that will help bring their venues to the forefront.