Endeavor Looking for Buyers for Sports Betting Biz, Including OpenBet
Endeavor Group Holdings, Inc. (NYSE: EDR) aims to divest its sports betting and data division, which includes OpenBet and IMG ARENA.
The firm stated that these divestitures are part of a strategy to part with certain assets prior to the $13 billion go-private deal with venture capital firm Silver Lake, which was revealed in April. Endeavor, located in Los Angeles, announced its second-quarter results earlier today.
"During the quarter, we began to actively market the businesses comprising the Sports Data & Technology segment, OpenBet and IMG ARENA. As such, for financial reporting purposes, these businesses are considered Held for Sale and the Sports Data & Technology segment is presented as discontinued operations in the Q2 2024 consolidated interim financial statements. During this process, these businesses will continue operating as usual,” according to a statement.
The company did not indicate whether it has engaged in discussions with any possible buyers so far, nor did it reveal any estimated selling prices for IMG Arena and OpenBet.
Endeavor Moves Swiftly to Sell OpenBet After Acquisition
Endeavor is rapidly seeking to divest OpenBet after revealing in September 2021 that it would acquire the company formerly named Scientific Games for $1.2 billion.
The purchaser initially intended to pay $1 billion in cash and $200 million in stock for OpenBet, but the price was reduced to $800 million in June 2022, with Light & Wonder (NASDAQ: LNW) — previously Scientific Games — receiving $700 million in after-tax returns.
OpenBet was integrated into Endeavor’s Owned Sports Properties division, which encompasses UFC, the Professional Bull Riders (PBR), and Euroleague.
Endeavor framed the purchase of OpenBet as an enhancement to the IMG Arena division, which offers data and technology solutions to sportsbook operators. It remains uncertain whether Endeavor will achieve a break-even point with OpenBet, make a profit, or incur a loss, but selling the unit now might be advantageous due to the emerging technology arms race in the sports betting market.
OpenBet Has Had Numerous Owners
OpenBet was established in 1996 under the name Orbis Technology, and throughout its almost thirty years of operation, it has undergone numerous ownership changes. In 2000, Orbis was acquired by NDS Group, a division of News Corp.
Ten years later, Orbis was rebranded as OpenBet, and in 2011, NDS divested the sports betting technology division in a management-led buyout backed by the private equity firm Virtuvian Partners. After five years, OpenBet was acquired by NYX Gaming Group. In 2016, Scientific Games acquired NYX, incorporating OpenBet into its SG Digital division.
As stated on its website, OpenBet's clients feature BetMGM, DraftKings, FanDuel, Paddy Power, PointsBet, Super Group, and William Hill, among others.
