If you have been a patient shareholder in William Hill and Ladrokes and Mecca (Corals) over the years, until recently you would have been rather disappointed.  Wm Hill shares in the last 5 years have fallen from 440p to 276p to Monday morning on 14th May 2018. Ladbrokes in isolation have halved in value in roughly the same period, until GVC appeared like a ‘Knight in white shining armour’ to sweep up what appeared to be this damsel in distress, until CEO Jim Mullen sorted out their technical problems as well as acquiring Corals.  Conversely, if you have been a Paddy Power Betfair acolyte, you would be purring like a Cheshire cat – shares up from £19 to £79 and change, again in the same period.


We know for a fact that Fred Done at Betfred has made a King’s Ransom including robbing the government blind metaphorically speaking in acquiring The Tote for £265m.  Those obsessed with online gaming such as GVC and 888 Holdings, have done extremely well.  888 Holding’s shares have doubled in the last five years having taken a bit of time to come on to the bridle after its IPO in 2005.


It is interesting to note that William Hill had the foresight to employ 400 people in Nevada in the hope that yesterday’s legislation would be passed – that many more states in the US apart from Nevada, Oregon and Montana would be granted licenses, as it has transpired. As for Paddy Power Betfair, they bought a licence in California as well as have a racing presence in Hollywood Park. So unsurprisingly Paddy Power Betfair’s share price rose like a grilse by 12.2%, with William Hill showing some form in adding 10.7% with GVC grabbing on to a gain of 7.4%. The betting industry in the US is gargantuan by any standards, with some luminaries suggesting it could be valued at $150 billion. Only the NFL seems to have balked at the idea of these massive radical changes in betting legislation.


Though these UK bookmakers have seen their vision rewarded with a bounce in their share prices, they will be really on their metal to perform and will need to be on top of their technological game.  Let’s be under no illusion, US operators such as Churchill Downs, Caesar’s Entertainments and Draft Kings already have very large footprints on the ground and they will be very reluctant to surrender ground to the ‘Limey Brigade.’ A more likely outcome is for Wm Hill to eventually fall in to the arms of a US predator. Another mild headache for PM May or whoever is in situ at the time to muse and decide on.


David Buik

Core Spreads

Core Spreads is financial trading as it should be. No noise – just tight spreads on thousands of markets.

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