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Why the iGaming industry is ripe for investment

In recent years, the iGaming industry has experienced significant growth across the globe. We take a look at some of the best areas for investment

Online gaming

The global iGaming and sports betting market was worth $70bn in 2020.

That figure is only set to rise, largely because of the growth in the US iGaming sphere.

The repeal of America’s PASPA legislation has given the green light to US states to launch their own regulated iGaming markets, bringing increased tax revenues to regional economies.

As more nations seek to regulate and license their online casino and sports betting markets, investors are increasingly attracted to organisations and operators that have the potential to dominate domestic or continental markets in the years to come.

Stateside iGaming opportunities

To that end, many companies are looking at investing and acquiring other iGaming innovators to strengthen their chances of taking a slice of the US iGaming pie.

Australian slot machine manufacturer Aristocrat Leisure Ltd is a prime example. The firm, which has developed land-based slot machines as well as free-play social games online, has spotted an opportunity to leverage the successful iGaming software firm Playtech to strengthen its overall position in the North American iGaming market.

Aristocrat recently acquired UK-based Playtech in a deal worth $3.7bn. Aristocrat offered $9.35 per share to Playtech’s shareholders, which equated to a 58% premium on its final closing price before the takeover was announced – such was the desire for Playtech to be under the Aristocrat umbrella – and with good reason. Playtech’s iGaming software continues to prove an attractive proposition in new and emerging iGaming markets.

It recently supplied its multi-channel iGaming platform to Holland Casino for the launch of its inaugural online casino in the Netherlands’ newly regulated market.

Playtech also signed a multi-state agreement stateside with Unibet Interactive, powering Unibet’s online casino games in New Jersey and additional states. This deal clearly pricked the ears of Aristocrat who could see the potential to solidify their position and fuse its in-house Oasis 360 casino management system with Playtech’s award-winning casino game portfolio, creating a compelling solution for regulated iGaming markets across North America.

Many of Playtech’s new and immersive slot titles are underpinned by HD-quality visuals and audio, such that its new title ‘The Mummy: Books of Amun Ra’ is listed as one of the best new slots.

Caesars recently acquired the US-based assets of William Hill in a deal worth $3.7bn

Caesars Entertainment is another prime example of a brand that’s recently invested heavily to leverage another award-winning, iconic brand to solidify its position in the US iGaming market.

Caesars recently acquired the US-based assets of William Hill in a deal worth $3.7bn. Caesars demonstrated no interest in managing William Hill’s assets in the UK and the rest of Europe, with the deal designed solely to catapult Caesars into the North American iGaming space, having thrived in the land-based scene for years.

Flutter Entertainment was also formed in early 2016 following the merger of Paddy Power and Betfair – two of the most prominent names in the British iGaming industry. It became an iGaming behemoth, listed as part of the iconic FTSE 100 Index, due to its immense value and potential.

Flutter took things to another level last year with yet another merger with The Stars Group. The Stars Group’s sizeable online presence in online poker, sports betting and casino gaming combines neatly with Flutter’s expertise in sports and casino betting. The merger has cemented Flutter as one of the premier betting brands on the planet.

The next big iGaming investment?

US-based iGaming and daily fantasy sports (DFS) giant DraftKings looked set to launch a takeover of Entain, the owner of iconic British sportsbooks Ladbrokes and Coral. However, its proposed $22.4bn takeover was recently abandoned.

DraftKings is the second US firm to take an interest in Entain, with MGM Resorts also having a bid declined earlier this year.

Savvy readers will rightly keep a close eye on Entain in the months ahead, as it seeks to cement itself as a well-rounded online entertainment brand.

Entain continues to invest itself, with a recent purchase of Unikrn designed to enhance Entain’s eSports wagering capabilities – another burgeoning subsector of the online sports betting industry.