Eldorado, The Stars Group Team Up in Online Sports Betting Deal
The Stars Group and Eldorado Resorts, Inc. have agreed to a 20-year deal in which The Stars Group – parent company of PokerStars and Full Tilt – will be able to operate sports betting sites in the United States under Eldorado’s gaming license. The agreement applies to thirteen states in which Eldorado operates: Colorado, Florida, Illinois, Indiana, Iowa, Louisiana, Mississippi, Missouri, Nevada, Ohio, and West Virginia. Eldorado also has properties in Nevada and Pennsylvania, but PokerStars already has business in place in those two states.
“We are excited to announce this agreement with Eldorado, one of the fastest growing regional gaming companies in the United States,” said The Stars Group CEO Rafi Ashkenazi in a press release. “This agreement establishes the foundation for our U.S. strategy as we tactically pursue access to other key states and opportunities with potential media partners.”
The two companies word the details of the deal differently, but what it sounds like is that in any state in which there will be a second Eldorado sports betting skin, The Stars Group has priority for the second one. If a third skin is launched for online casino games and poker, The Stars Group can claim that one, as well.
“The Stars Group is one of the world’s largest, most licensed and most geographically and product diverse publicly listed online gaming companies. We are excited to work with The Stars Group to capitalize on their proven ability to leverage their products to gain share in the growing market for online gaming,” said Eldorado Chairman and CEO Gary Carano.
Eldorado Gets Money Upfront and Down the Line
There is also the financial aspect of the arrangement. As one would expect, The Stars Group will pay Eldorado a portion of the revenue earned from the gaming sites. In addition, The Stars Group will give Eldorado a $25 million equity share in the company and possibly another $5 million at a later date. More equity may be issued after five years, based on the performance of The Stars Groups’ skins.
Eldorado inked a deal in September with William Hill in which William Hill will be the company’s exclusive sports betting provider for its brick-and-mortar casinos. William Hill factors into the Stars deal, as it gets the first and third Eldorado sports betting skins in each state.
In October, Eldorado completed its acquisition of Tropicana Entertainment, adding seven new properties to its portfolio, most notably the Tropicana Casino and Resort in Atlantic City. It also expanded its geographic footprint from eleven to thirteen states, adding Missouri (Lumière Place) and Indiana (Tropicana Evansville).
The Stars Group now has a more solid foothold in the United States online gaming market. As mentioned, it already operates in New Jersey, partnering with the Resort Casino Hotel in online poker, online casino games, and most recently, online sports betting. It has partnered with Mount Airy Casino in Pennsylvania, waiting for that state’s online gaming industry to launch. Of the states where Eldorado has properties, West Virginia, Mississippi, and Nevada have legalized sports betting.
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