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William Hill offloads Australia business amid tighter regulatory environment
William Hill has signed a binding agreement to dispose of its William Hill Australia business to CrownBet Holdings - a wholly owned subsidiary of CrownBet, which is owned by The Stars Group - and a group of shareholders associated with the founder and CEO of CrownBet, Matthew Tripp, it announced on Tuesday.
The FTSE 250 bookmaker said the sale was for an enterprise value of AUD 300m, equivalent to an equity value of AUD 313.7m.
William Hill Australia operates licensed betting, over the telephone, internet and mobile phone platforms in Australia.
The board said the disposal followed its announcement in its trading statement in January that the business was undergoing a strategic review as a result of the credit betting ban in Australia, and the likely introduction of a point-of-Consumption tax in a number of states, applying increasing pressure on the profitability of the division.
In the year ended 26 December, which William Hill said was not materially affected by the credit betting ban or the introduction of new taxes, William Hill Australia had revenues of AUD 201m and EBITDA of AUD 47m.
The gross assets of William Hill Australia for the year were approximately £133m.
William Hill said the disposal was expected to complete following regulatory approvals from the Foreign Investment Review Board and the Northern Territory Racing Commission, which the board expected would be obtained in a timely manner.
An announcement confirming completion would be issued in due course, it added.
Disposal proceeds, net of costs, would be used initially to reduce group indebtedness and invested to support further growth of William Hill.
"We are pleased to announce the sale of William Hill Australia to CrownBet," said William Hill CEO Philip Bowcock.
"The disposal follows a strategic review of the business, launched in January after its profitability came under increased pressure due to the recent credit betting ban and the likely introduction of a point of consumption tax.
"The disposal will allow William Hill to focus on continuing to grow our UK online and US businesses, particularly as we prepare for the decision on the PASPA appeal due in 2018."