Endeavor Drops OpenBet Buy Price to $800 Million, Down 33%
Endeavor is buying sports betting tech platform OpenBet for $800 million, 33% less than previously disclosed.
The new price was detailed in a Thursday afternoon SEC filing. It comes nine months after the company (NYSE: EDR) announced it would purchase the OpenBet from Light & Wonder (Nasdaq: LNW) for about $1.2 billion in cash and stock.
The financial breakdown is changing too. The deal was originally $1 billion in cash and the rest in Endeavor shares. It is now $750 million in cash and $50 million in stock. It is expected to close by the end of 2022.
The filing doesn’t provide a reason for the revised price, but the market realities are very different now than they were back in September. That’s especially true in U.S. sports betting, where the high cost for data, rights and new customers have tempered investor expectations of some of the industry’s most prominent companies.
Light & Wonder, previously called Scientific Games, is down roughly 45% from its high last September. Endeavor is down about 28% over the same span.
Representatives for Endeavor and Light & Wonder didn’t immediately respond to emails seeking comment about the price revision.
Endeavor plans to pair OpenBet with IMG Arena, its existing sports betting unit, which works with hundreds of sports betting operators to provide data and live streaming for sports around the world. Endeavor CFO Jason Lublin said in September that OpenBet and IMG Arena would combine to form a new, fourth reporting line that would start with $340 million in annual revenue.
That combined entity, which adds OpenBet’s trading services and betting engine, would be more able to compete with Sportradar (Nasdaq: SRAD) and Genius Sports (NYSE: GENI), two giants in the world of back-end sports betting services, according to analysts.
Light & Wonder rebranded earlier this year after agreeing to sell OpenBet to Endeavor and its lottery business to Brookfield Business Partners in a $6.05 billion deal. That lottery transaction closed in April.
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