The Stars Group (TSG) will obtain access to Eldorado Resorts’ online sports betting skins in the states, where Eldorado owns or operates casino properties.
The deal is structured so that TSG gets first skin rights for Eldorado’s multiple casino property states, and ‘second skin’ for all others.
In addition, TSG will have an option to access the casino operator’s third skin to operate real money online gaming and poker operations across the country.
Eldorado’s exclusive provider for land-based retail sports betting remains William Hill, who have access to Eldorado’s first and third skin for online sports betting in all applicable states.
The agreement currently covers Colorado, Florida, Illinois, Indiana, Iowa, Louisiana, Mississippi, Missouri, Nevada, Ohio, and West Virginia, which, when combined with existing market access deals in New Jersey and Pennsylvania, gives TSG access to 13 states.
Eldorado, who will receive a revenue share from the operation of TSG brands under its licenses, will also receive an upfront equity interest in TSG of $25 million, as well as an additional $5 million in equity upon the exercise of the first option by TSG, following the satisfaction of certain conditions.
A further equity stake may be provided to Eldorado after five years, based on TSG net gaming revenue generated in Eldorado’s markets, at a fixed rate of $23.22 per TSG share.
Rafi Ashkenazi, chief executive officer of The Stars Group, said: “We are excited to announce this agreement with Eldorado, one of the fastest growing regional gaming companies in the United States.
“This agreement establishes the foundation for our US strategy, as we tactically pursue access to other key states and opportunities with potential media partners.”
Gary Carano, chairman and chief executive fficer of Eldorado, commented: “The Stars Group is one of the world’s largest, most licensed and most geographically and product diverse publicly listed online gaming companies.
“We are excited to work with The Stars Group to capitalize on their proven ability to leverage their products to gain share in the growing market for online gaming.”