Entain PLC announced last week that it has hastened its planned exit from most unregulated markets unless those jurisdictions have a clear path to regulation. This is a slight deviation from a statement the company made in late 2020.
The FTSE 100 company, formerly known as GVC Holdings PLC, is one of the world’s biggest sports betting and gaming groups operating in the retail and online sectors. The firm announced a change of name in 2020 and also stated that it would derive 100% of revenue from “nationally” regulated markets by 2024 – part of a strategy of “sustainability, growth, and innovation.”
The January 18, 2023 statement from the company said: “From today, the Group will accelerate this process by exiting its few remaining markets where there is no clear path to market liberalization via domestic regulation,” a slight change from “National regulation”. The change may be a nod to the fact that there is no federal framework planned in the United States for online sports betting or casinos – each state has its own regulation.
Housekeeping for Regulated Markets
Industry observers are examining another potential takeover bid of Entain from MGM in the near future. Many have predicated that possibility on a UK White Paper finally being issued dealing with British and offshore gambling policy, particularly operators who offer services in Great Britain and also have operations overseas.
MGM Resorts International partnered with Entain on a 50/50 basis to launch the American online sportsbook, BetMGM. The casino operator with properties in Las Vegas, Macau, and soon Osaka, Japan offered $11.06b for Entain two years ago but shareholders rejected the offer.
Entertain is licensed in over 30 countries and only a few markets where regulation doesn’t currently exist will see them hold on until the end of 2023 – and only in those that it sees a clear path to becoming regulated “in due course”.
Those markets are so small that Entain does not expect net gaming revenue and EBITDA to be negatively impacted and their loss will have “no effect on current expectations”.
“With the exception of these markets, 100% of the Group’s revenue will now be from domestically regulated markets where it is licensed,” Entain said.
The group did not identify which markets it is exiting with immediate effect or those it will hold onto in hopes of seeing regulations in place in the coming year in order to be licensed.
Longstanding Decision
Entain Chairman, Barry Gibson said: “As part of the transformation program that Entain has undergone in the last few years, we took the decision in 2020 to only operate in nationally regulated markets. Today’s announcement is therefore a continuation of that strategy, and should be taken as a clear demonstration of Entain’s commitment to the highest standards of corporate responsibility, governance, sustainability, and player safety.
“We stated at the outset that we would exit any market that wasn’t able to regulate at sufficient pace or to the right standards, and we have acted decisively to do so. We are proud to be leading our industry as the only global operator taking this approach of solely operating in markets where there is domestic licensing.”
According to some market reports, Berenberg Bank analysts in Germany have recently taken a new look at Entain stock value. According to the UK’s Investing Reviews: “The German bank believes the Entain share price could hit 1,930.00 (GBX). Given the current price of Entain shares sitting at 1,495.49 (GBX) in early trading on January 20, this equates to a potential upside of 22.52%“.
The bank also restated its ‘Buy’ rating for the current Entain share price.
Source: Acceleration of unregulated market exits, Entain Group, January 18, 2023
The post Entain On Track to Exit Unregulated Markets by 2024 appeared first on Casino News Daily.
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