Empire Resorts, Inc., now an affiliate of bet365 Group Limited (bet365) and Resorts World Catskills today revealed a “strategic alliance” to join the rapidly expanding sports wagering business space in the U.S. by creating a physical and online sportsbook in New York State.
Sports wagering is not currently legal in New York, however, rules and accompanying regulations are expected to come under close examination by New York State lawmakers in 2019, Democratic State Assemblyman J. Gary Pretlow (D-89th District) told Sports Handle in an interview last week. Pretlow is the state lawmaker sponsoring enabling legislation that would legalize full-fledged sports betting in the state.
Resorts World Catskills in Kiamesha Lake, on the site of the former Concord Hotel, a “Borscht Belt” landmark, is New York’s newest and largest integrated commercial casino resort destination with the closest proximity to Manhattan. Empire, as a bet365 affiliate company, is part of the world’s largest online sports bookmaker. The parties said in a media release that their 20-year agreement would become effective when permitted by applicable law.
NY Sports Betting News: Empire Resorts, Inc. Announces Strategic Alliance to Develop a Physical and Online Sportsbook for Resorts World Catskills
Financial details of the Empire/Resorts World Catskills deal call for the companies to share profits 50/50 after bet365 recoups its start-up and other costs, and that a corporate affiliate of bet365 will acquire up to $50 million of Empire common stock at a price of $20 per share in two installments, making it Empire’s second largest stockholder. Additionally, Kien Huat Realty III, Ltd., Empire’s largest stockholder, has committed to purchase up to $126 million of convertible preferred stock, with a conversion price of $20 per share, the companies said.
Industry observers believe New York State lawmakers will be under intense pressure to expeditiously act on sports betting because New Jersey is currently siphoning away sports betting dollars and accompanying taxes through its legal, regulated sports betting outlets. Pennsylvania, another New York neighbor, is expected to begin offering legal sports betting in the next few weeks.
With annual revenues of over $3 billion, bet365 is known for its dominant worldwide online presence and its “in-play” betting product.
Seventy-five different worldwide sports are currently covered as part of what bet365 says it the industry’s widest range of “in-play” sports betting markets. The company also streams 160,000 live events annually on the bet365 sites, offering customers the ability to watch those sports events while wagering.
“Joining forces with bet365 positions Empire and our flagship Resorts World Catskills to lead a potentially enormous new market,” said Manny Pearlman, Executive Chairman of Empire Resorts, Inc. “bet365’s global expertise in effectively developing and executing world-class sportsbooks strongly complements Empire’s leadership in commercial casino operations in New York.”
A June report from industry publication Gambling Compliance projects that the New York sports betting market will surpass Nevada’s as the biggest in the U.S., and further that the New York market will reach $700 million in revenue within the next five years, assuming the Empire State indeed passes enabling legislation that fully opens the market.
“This landmark agreement, which combines Empire’s gaming operating skill with our expertise in providing best-in-class online sports betting, allows bet365 to tap into what we believe will be one of the most significant online and sportsbook markets in the United States,” said Simon Betteley, President of Hillside (New York) LLC, a bet365 affiliate.
Following its initial investment, which closed today, the affiliate of bet365 will own approximately 4.9% of Empire’s outstanding common stock. Pursuant to what the companies call their “Sports Wagering Agreement,” the parties expect to use the bet365 brand and online consumer sports betting and digital platform.
Empire also owns and operates Monticello Casino and Raceway, a 45,000-square foot video gaming machine and harness horse racing track in nearby Monticello.
Although not a well-known brand in the U.S., bet365 is licensed and regulated in Great Britain, Gibraltar, Malta, Denmark, Estonia, Spain, Italy, Ireland, Bulgaria, Cyprus, and Australia and has multiple other license applications pending or in process.
In July, bet365 announced a deal to run the sportsbook at the newly opened Hard Rock Atlantic City. Then in October, Gaming Innovation Group (GIG), announced that it had signed a letter of intent to provide “omni channel” sportsbook services as Hard Rock’s online gambling platform provider. Each New Jersey licensee may use up to three “skins.”
Hard Rock Atlantic City remains one of the last properties currently without an operating sports book.