888 Set to Complete William Hill Acquisition amid Revenue Dip
888 Holdings has said that it expects to see a drop in revenues from the first half of this year mainly due to strict new regulations in the UK and the company’s temporary withdrawal from the Dutch market.
In the group’s latest trading update, it put forth the details of a plan to raise £1.7 billion of funded debt that will be used to finance its acquisition of William Hill’s international business, which is due to complete on 1 July.
As such, the group expects revenues of £330-335 million for the first six months of the year, down from £431.8 million in the same period last year.
However, 888 explained that this year’s performance has so far mainly been in keeping with expectations. There has been growth in some European markets, but this has been offset by new safer gambling measures in the UK and the departure from the Netherlands.
For the 12 months ending 28 February 2022, 888 saw revenues of £690 million and adjusted EBITDA of £109 million. It said that the non-us business of William Hill brought in revenue of £1.37 billion and adjusted EBITDA of £238 million for the year ending 22 February 2022.
The performance of both businesses largely reflects a continuation of the trends outlined in the prospectus dated 29 April 2022, with the positive impact of retail reopening and strong performances across a number of regulated countries being offset by the closure of the Netherlands and the impact of additional safer gambling measures within the UK online segments of both businesses.
The company said that it will market £1.02 billion of debt today and enter into more than £750 million worth of loans before the completion of its acquisition of William Hill from Caesars Entertainment.
The cash is to be used to finance the acquisition, service the debt and fees owed by 888, and pay fees related to the acquisition. The loans are due to mature in 2028, and the group said it also expects to enter into a £150 million revolving credit facility.