$4.7 billion is a large sum of money. It’s also the amount The Stars Group – parent company of PokerStars – say it has agreed to pay in return for UK-based Sky Betting & Gaming.
It’s pretty hard to classify this as anything other than a giant, brassy, bold-as-hell wager on sports betting maintaining its position as the fastest growing segment of the online gambling industry.
For The Stars Group, the torrid growth of global online sports betting coupled with the United States’ pending repeal of PASPA makes increasing its sports betting capabilities an undoubtedly smart move. The sheer amount of money makes it seem like a huge gamble, but if the play is sharp and you have the capital, getting the bet down is better than sitting on the sidelines.
In this case, only time will tell – but The Stars Group may not have to wait very long to to settle its bet.
A new brand takes shape
2017 was a remarkable year for The Stars Group. Formerly known as Amaya, the company parted ways with founder and CEO David Baazov – who is currently on trial for insider trading – in 2016, before rebranding as The Stars Group in the first half of 2017.
During this same period, The Stars Group reported that its casino and sportsbook offerings made up 29% of the company’s revenue from April to June, which was a 21% increase over the same period in 2016.
In addition to the rebrand, the company also began paying down some of its debt, after which newly appointed chief executive officer Rafi Ashkenazi was quoted as saying, “When it comes to casino, and I’ll also include the sports betting, I believe we are just at the beginning of the journey.”
For pundits and anybody else now looking back at how The Stars Group brand took shape, there were more signs that pointed towards a large acquisition in the offing. Among them, another comment from Ashkenazi, who said, “We are very open to acquisitions generally,” while also noting sports betting was of the “highest priority.”
With its acquisition of Sky Betting & Gaming, The Stars Group can check priority number one off the list.
The rundown on Sky Betting & Gaming
Sky Betting & Gaming is the largest online sports betting operator in the United Kingdom, and features brands like SkyBet, SkyVegas, Sky Sports Fantasy Football and Soccer Saturday Super6.
The company’s stated goal is to become the “UK’s best digital business” and focus on bringing better betting and gaming options to market. A brief perusal of the Sky Betting & Gaming careers website also indicates a progressive culture, an agile work environment and an ultimate goal of delivering a fantastic digital customer experience.
It appears The Stars Group has done its research, which leads us back to the question of whether this acquisition is a gamble, or an extremely smart bet.
What does this mean for sports betting in the US?
Let’s get one thing straight: there is still plenty of room for gambling expansion in Pennsylvania, and indeed across the United States. The entire gambling industry is waiting on the US Supreme Court, but in the meantime, The Stars Group has certainly given us something meaty to chew on.
PokerStars, the current face of The Stars Group, has been active in the New Jersey online gambling scene since 2016, and is poised to enter other states in the very near future.
Will we see The Stars Group integrate PokerStars with Sky Betting & Gaming platforms to keep the “Stars” customer experience intact, or will we see the Sky brand emerge in the US? At this point, it’s unclear.
My guess is that The Stars Group, which has already leveraged casino games to prop up stagnant poker offerings, will use online sports betting in a similar fashion. Every poker player I know – myself included – loves to throw down a bet or two on games they’re watching while playing. And the influx of casino and sports gamblers certainly won’t hurt the action on the felt. It’s a win-win.
At the end of the day, The Stars Group’s acquisition of an experienced online casino and sports betting operator seems like not only a huge boon for the company, but a great sign for sports bettors in the US. Get ready to place your bets!