Bally’s and Caesars bet on fantasy stakes
Monday was a busy day for the world of DFS with two transformative deals placing the format at the center of the betting land-grab.
First out of the blocks was Bally’s Corporation which announced it had acquired Monkey Knife Fight (MKF).
The all-stock transaction could reach $90m.
Then came the news that Caesars Entertainment has taken a minority equity position in SuperDraft.
Caesars has the option to acquire the whole group in the future.
Bally’s said MKF is the fastest-growing gaming platform and third-largest daily fantasy sports (DFS) operator in North America.
It claims 180,000 registered users and 80,000 depositing players.
SuperDraft and MKF are active across up to 37 states between them.
For both Caesars and Bally’s the deals are about unregulated states as much as the growing regulated arena.
Bally’s said MKF would help develop potential sports bettors databases in states such as California, Florida and Texas.
Over time, these could be the biggest regulated sports betting states. Some predict they will be worth 20-25% of nationwide betting revenues over time.
Bally’s said it will also enable it to build a player database in Canada. More widespread sports-betting legalization is expected.
SuperDraft, meanwhile, will be integrated into Caesars nationwide rewards program.
To kick-off the partnership it is launching its first $1m tournament for SuperBowl LV with the SuperMillion Big Game contest.
“The addition of daily fantasy sports fits seamlessly with our strategic vision for mobile and online sports,” said Tom Reeg, CEO of Caesars Entertainment.
Positive redirect for Bally’s
For Bally’s the agreement is another step in its redirect and diversification strategy towards online sports betting and gaming.
It has acquired the online betting solutions provider Bet.works for $125m.
It will combine MKF’s presence in 37 states with Sinclair Broadcast Group’s media footprint. This includes a portfolio of 21 regional sports networks.
Analysts at Truist Securities were positive about the transaction saying it placed Bally’s in direct competition with market leaders DrfatKings and FanDuel.
They added that it complemented the Sinclair transaction by offering DFS in states where the group isn’t present or sports betting isn’t yet regulated.
“We do not think the market is fully factoring Bally’s meaningful sports betting/iGaming opportunity,” they added.
Bally’s is currently a lesser name in terms of the Wedge Index of gaming friendliness. As such it currently does not add many points to the tally of any state in which it is present.
That, however, might change given recent moves.
For Caesars, meanwhile, the move towards fantasy is more incremental. Caesars is currently a second-tier brand on the index.