The Stars Group, the parent company of online poker behemoth PokerStars, made a major move this week in acquiring Sky Bet. The deal, reported to be worth $4.7B in cash and stock, moves a sizable chess piece on the board of a very fluid sports betting landscape.
The deal will make the Stars Group the largest publicly-traded gaming company.
But is it a good move?
PokerStars has been flirting with entering the sports betting market going back to the glory days pre-2011. In those happier times, as the company was making $1M a day in rake, running a sportsbook was viewed as a muddying of the waters for potential legalized U.S. entry.
Post-Black Friday, online poker legalization has made a “snail’s pace” seem like a Usain Bolt sprint. Online poker is so aughts. It’s over. It’s done. It’s not coming back to the levels it ever was.
But with daily fantasy’s rise and popularity, assists from progressive sports league commissioners like Adam Silver pushing integrity fee-laden agendas, and the general proven scientific fact that betting on sports makes watching sports more enjoyable, sports betting legalization appears inevitable. It’s the new online poker, except with a larger customer base, mainstream support, and revenue potential.
With a potential PAPSA repeal on the Supreme Court front-burner, the time is now to position yourself for market entry. Stars did. It was a good move.
Let’s say PASPA isn’t repealed…
It’s still a great move.
Stars diversifies its revenue, increases its revenue in the sports betting sector, and increases its presence in regulated markets.
The U.S. sports betting market is the holy grail, but even if that ends up being years away, Stars still wins.