Wynn Resorts Ltd. has revealed a plan to spin off its WynnBET mobile sports app and merge it into a new publicly traded company through a special purpose acquisition company (SPAC) in partnership with William Foley, principal owner of the NHL’s Vegas Golden Knights hockey team.
The company’s top executives revealed the plan last week during Wynn’s quarterly earnings call. It was announced the company has signed an agreement with Foley’s Augerlitz Acquisition Corp. SPAC to create a new public company from what is now Wynn Interactive Ltd., the operator’ subsidiary. The new company will retain the Wynn Interactive name and will relist on the Nasdaq exchange under the symbol WBET.
“We are confident that this transaction will unlock the tremendous potential of Wynn Interactive to further accelerate growth and enable the business to capture the massive opportunity in North America,” said Wynn CEO Matt Maddox, according to the Las Vegas Review-Journal.
“Bill Foley is the ideal partner to ensure continued success—his track record with business combinations, extensive experience growing marquee consumer brands and partnering to maximize value in businesses like ours will be invaluable as we continue scaling.”
According to the company, the deal is expected to raise around $640 million in cash to fund operations and growth initiatives. Current Wynn Interactive shareholders will retain around 79 percent of the new company, with Wynn Resorts holding a 58 percent controlling interest.
“We knew that we had to stick with what we do, which is build great product and provide the best customer service,” Maddox said. “Wynn Interactive is now a company with over 300 people. We have some of the luminaries from European gaming, the co-founders of Bwin (Interactive Entertainment) that are responsible for a lot of the product that we’re developing in this 300-person team.
“As we looked out into the future and we realized this likely going to be as large a commercial casino revenue opportunity of $40 billion over the next five-plus years… we knew that this was an opportunity that we had to capitalize on.”
“Wynn Interactive is rapidly establishing a leadership position in what will ultimately be a $45 billion North American online sports betting and iGaming market through our relentless focus on product features, user experience and customer service,” Wynn Interactive President and Executive Director Craig Billings said during a presentation posted following the earnings call.
Billings further predicted that WynnBET will grab a 20 percent-30 percent market share in Massachusetts, where discussions on sports betting are ongoing in a state where current estimates place potential gross gaming revenue from sports betting in the neighborhood of $850 million, with Wynn’s Encore Boston Harbor resort in the middle.
“We’ll be ready to go on day one (in Massachusetts);” Billings said. “We have a very strong home-court advantage there . We have a $2 billion-plus asset in the middle of Boston, and it will prove to be very fruitful.”
WynnBET is currently active in six states—New Jersey, Colorado, Virginia, Indiana, Tennessee and Michigan, Currently available in New Jersey, Colorado, Michigan, Virginia and Indiana, with market access opportunities in 10 states and several pending license applications in process. With more than 13 million users, the mobile sports and casino betting app provides unique social betting mechanics, and a high-quality user interface.
According to Billings, the app will soon be fully integrated into the Wynn Rewards player loyalty system, meaning users will earn points that can be redeemed at Wynn properties worldwide.
Wynn Interactive this year has announced several content and marketing affiliate partnerships, including the sports podcast network Blue Wire, Players’ Tribune and FanSided parent Minute Media, the NBA’s Memphis Grizzlies and Detroit Pistons, and NASCAR.
The combine value of the merged companies is expected to be $3.2 billion.
