888 Holdings has announced that it is undertaking a strategic review of its US operations and will now consider the sale of the group’s B2C business in the United States.
In a statement released today, the company, which owns William Hill (UK), 888 and Mr Green, said that it would also consider a controlled exit of US B2C operations, or other possible strategic transactions.
Right now, 888 is currently active in four states with SI Sportsbook live in Michigan, Colorado, and Virginia, SI Casino live in Michigan, and 888casino live in New Jersey.
However, today’s announcement also revealed that the company would terminate its partnership with Sports Illustrated (SI). As part of the termination agreement, 888 has agreed to pay SI $25 million immediately and a further $25 million between 2027 and 2029.
According to the statement, the group’s US profit margin is lower than the overall group level. The company states that this is a reflection of the significant costs of operating in the US and the competitive nature of the local market. As a result, the group has come to the conclusion that its current operations in the US will not offer optimal returns. The termination of the SI deal is projected to result in cost savings of $6 million to $7 million per year.
Per Widerström, CEO of 888, commented:
“Since commencing my role as CEO I have been focused on ensuring the Group is set up to deliver strong value creation in the coming years. In the US, the intensity of competition and requirement for scale means huge investment is required to reach profitability.
Our partnership with Authentic has consistently driven strong demand for the SI brand across both consumer experiences and product offerings. A series of record-breaking months for SI Casino has underscored the strength of the SI brand. However, despite these successes, we have concluded that achieving sufficient scale in the US market to generate positive returns within an accelerated timeframe is unlikely.
The strategic review of our US B2C operations will continue at pace, and I look forward to updating shareholders on our plans for the wider Group in late March.”
No timeframe has been set for the completion of the strategic review.
In August of 2021, 888 and SI announced a long-term partnership agreement ahead of its launch in the state of Colorado. Then, in an unanticipated move, the company pulled its sports betting product from the New Jersey market in December of the same year.
An experienced iGaming commentator and analyst based in New York City – Jenny reports on regulation and gambling industry news and events.
888 Holdings, a prominent online gambling company, recently announced the end of its partnership with Sports Illustrated as it contemplates exiting the US market. This decision comes as a surprise to many in the industry, as the partnership between 888 and Sports Illustrated was seen as a strategic move to capitalize on the growing popularity of sports betting in the United States.
The partnership between 888 and Sports Illustrated was formed in 2020, with the goal of providing sports fans with a unique and engaging sports betting experience. Through this partnership, Sports Illustrated launched its own sports betting platform powered by 888’s technology and expertise. However, it seems that this partnership did not meet the expectations of either party, leading to the decision to end the collaboration.
888’s potential exit from the US market is also raising eyebrows among industry experts. The company has been operating in the US for several years, offering online casino and sports betting services in states where it is legal. However, recent regulatory changes and increased competition in the US market may have prompted 888 to reconsider its presence in the country.
While 888 has not yet made a final decision on its future in the US market, the company’s move to end its partnership with Sports Illustrated could be a sign of larger changes to come. As the online gambling industry continues to evolve and adapt to new regulations and market conditions, it is not uncommon for companies to reassess their strategies and make tough decisions about their operations.
For now, sports fans and bettors who have been using the Sports Illustrated betting platform powered by 888 will need to find alternative options for their online wagering needs. It remains to be seen what the future holds for 888 Holdings in the US market, but one thing is clear – the online gambling industry is constantly changing, and companies must be prepared to adapt in order to stay competitive.
