Eldorado Resorts Announces Partnership with the Stars Group
The Stars Group announced that it entered into an agreement with Eldorado Resorts that grants it the option to operate online betting and gaming in the states where Eldorado currently or in the future owns or operates casino properties. The agreement currently covers 11 states.
Colorado, Florida, Illinois, Indiana, Iowa, Louisiana, Mississippi, Missouri, Nevada, Ohio, and West Virginia) which, when combined with The Stars Group’s existing market access deals in New Jersey and Pennsylvania, gives The Stars Group access to up to 13 states. Unless otherwise noted, all dollar ($) amounts are in U.S. dollars.
The agreement grants The Stars Group the option to own, operate and brand real-money online sports betting, poker and casino offerings in each of the applicable states subject to license availability, state law and regulatory approvals. As it relates to sports betting, The Stars Group’s options will provide first skin access in states where Eldorado owns or operates more than one casino property and second skin access in all other applicable states.
“We are excited to announce this agreement with Eldorado, one of the fastest growing regional gaming companies in the United States,” said Rafi Ashkenazi, Chief Executive Officer of The Stars Group. “This agreement establishes the foundation for our U.S. strategy as we tactically pursue access to other key states and opportunities with potential media partners.”
Gary Carano, Chairman and Chief Executive Officer 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.”
Under the terms of the agreement, Eldorado will receive a revenue share from the operation of the applicable offerings by The Stars Group, and The Stars Group will issue Eldorado approximately 1 million common shares at a price of $23.22per share for a value of $25 million and an additional $5 million of common shares upon The Stars Group’s exercise of the first option and following the satisfaction of certain conditions. Further, Eldorado would be entitled to additional common shares of The Stars Group at a price of $23.22 per share beginning in five years. The number of additional shares potentially issuable to Eldorado would be solely based on the success of The Stars Group’s online gaming offerings in applicable states as measured by net gaming revenue generated in each applicable state.
This announcement follows The Stars Group and Resorts Casino Hotel’s recent launch of online sports betting through The Stars Group’s BetStars brand in New Jersey alongside its existing online poker and casino offering available through PokerStarsNJ and PokerStarsCasinoNJ, as well as The Stars Group’s partnership with Mount Airy Casino Resort to enter Pennsylvania’s online gaming market.