Endeavor sells OpenBet and IMG Arena to OB Global Holdings in management buyout for $450M

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AGBrief Editorial

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November 12, 2024

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Endeavor sells OpenBet and IMG Arena to OB Global Holdings in management buyout for $450M

Endeavor Group Holdings (NYSE: EDR), a global sports and entertainment company, has announced that it has agreed to sell OpenBet and IMG ARENA to OB Global Holdings LLC.

The management buyout is backed by Ariel Emanuel and includes participation from OpenBet executives, including CEO Jordan Levin.

Commenting on the deal, OpenBet’s CEO Jordan Levin said: “This management buyout allows us to continue executing our vision for increased market expansion and product innovation. Our group is extremely confident in OpenBet’s future considering the premium product offering, superior talent, and solid foundation we already have in place following a strong period of business growth.”

Under the terms of the transaction, OB Global Holdings will acquire the businesses for approximately $450 million, subject to certain adjustments, financed through a mix of cash and debt.

During the sign-to-close period and after closing, Endeavor will continue to market IMG ARENA for sale to a third-party purchaser.

OpenBet powers responsible betting and gaming entertainment for more than 200 market-leading operators around the globe. Following the close of the transaction, Levin will continue to lead the business as CEO.

The transaction is being pursued and is a necessary step, for the closing of the proposed Endeavor take-private by Silver Lake. The transaction is subject to customary closing conditions, including approvals required under applicable gaming regulatory authority, and is conditioned on and expected to close immediately prior to the closing of the Endeavor take-private.

Oakvale Capital LLP and The Raine Group acted as financial advisors to Endeavor.

Good morning. Flags fly at half mast today, after the passing of one of Macau’s most prominent casino moguls, Lui Che Woo, at the age of 95. His legacy, however, will continue, as evidenced by the massive footprint that the company has in Macau and its continual push for more. Meanwhile, in the Philippines, the POGO ban causes further backlash, with an expansion of illegal betting networks elsewhere ongoing and expected. And in results, Maybank analysts curtail their Bloomberry estimates on low GGR turnout.

What you need to know

Galaxy Entertainment Chairman Lui Che Woo has passed away at the age of 95, leaving behind a legacy of success.
The Philippines’ POGO ban accelerates illegal betting networks’ global reach, from Asia to Europe and Africa, warns research.
Maybank lowers Bloomberry’s revenue expectations for FY24/25 by 12%, citing weak GGR and fewer Chinese VIP players.

On the radar

South Korea’s GKL sees net income drop by nearly half in 3Q24.
Shin Hwa World to issue $25.7M bonds for business development.
South Korean operator Paradise Co sees drop in earnings in 3Q24.
Nearly 10K arrested in South Korean police crackdown on youth gambling.

AGB Intelligence

GALAXY ENTERTAINMENT GROUP

Chairman Lui Che Woo has passed at 95

Galaxy Entertainment Group’s leading light, Chairman Lui Che Woo has passed. The businessman leaves behind a heady legacy after his 95 years of progress, which included the listing of one of Macau’s most prominent casino businesses and one of the highest-performing companies worldwide. Shareholders and friends mourn his passing but reflect positively on the legacy he left behind.

Corporate Spotlight

1xBet: Capitalize on Asian teams’ World Cup qualifier struggles

Profit from the challenges faced by top Asian teams in World Cup qualifiers

Asia is the most populated continent on the planet and Football is the No. 1 sport in most countries. The World Cup qualifying matches are traditionally watched by billions of fans in the region, but FIFA has decided to reward Asia with a significant representation at the tournament only now.

Altenar brings premium sportsbook solution to Asia

Altenar, a leading sportsbook provider is bringing its global expertise to Asia, looking to expand its operations. Since 2011, Altenar has powered hundreds of online sports betting sites worldwide and is a major B2B provider in Europe and Latin America licensed markets.

Industry Updates

SOFTSWISS unveils key insights on iGaming Trends 2025 Report.
EvenBet Gaming to unveil latest Poker innovations at SiGMA Europe 2024.
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MEMBERSHIP | INTELLIGENCE | ASEAN | CAREERS

Maybank notes the uneven growth within the gaming industry in the country, highlighting that while the overall Philippine gambling sector has seen robust growth, largely driven by electronic gaming (e-games), the performance of traditional gaming operations in Entertainment City has been lackluster. GGR from SEC was down 13 percent YoY in the first half of 2024, primarily due to fewer Chinese VIP players, who have historically contributed significantly to the region’s gaming revenues.

According to an investment memo on Monday, despite the short-term weakness in SEC, Maybank sees a promising outlook for Bloomberry as the company continues to focus on its mass gaming segment through its Solaire Resort North property, which is expected to perform better in the coming year.

The $1 billion property, Solaire Resort North, officially opened on May 25th of this year. The group had previously revealed the ramp-up of Solaire Resort North, which achieved a positive EBITDA of PHP250 million ($4.32 million) in its first 37 days of operation.

Loan refinancing enhances cash flow

Bloomberry’s recent loan refinancing is expected to boost its cash flow, which could help the company navigate short-term challenges. On October 15th, 2024, Bloomberry, the operator of Solaire Resorts, secured a PHP72 billion ($1.24 billion) syndicated loan refinancing facility, replacing outstanding balances from previous term loans. The new facility comes with a 10-year term and a back-ended principal payment structure, with over 65 percent of the principal due in the last five years.

The loan is priced 75 basis points lower than its previous loans and includes an option to fix the interest rate within the next 12 months, allowing Bloomberry to benefit from any future interest rate cuts. This refinancing is expected to reduce debt service pressures and provide more financial flexibility, particularly as the company’s SRN property ramps up operations.

Despite recent setbacks, including a 40 percent decline in Bloomberry’s share price from its March 2024 peak of PHP12.00 ($0.20) to PHP7.16 ($0.12), Maybank sees this as a potential buying opportunity. The investment bank cites the stock’s current value, trading at a measure of EV/EBITDA below its historical average.

Shin Hwa World to issue $25.7M bonds for business development

Viviana Chan

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November 12, 2024

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Shin Hwa World to issue $25.7M bonds for business development

South Korean integrated resort operator Shin Hwa World announced on Monday that it plans to issue bonds valued at HK$200 million ($25.7 million) to raise long-term funds for its business development.

The company’s Directors stated that the proposed bond issue presents an opportunity to secure long-term financing while broadening its sources of capital. They believe the bond terms are fair and reasonable, given the current market conditions, and that the issuance is in the best interests of both the company and its shareholders.

The bonds are expected to carry an annual interest rate ranging from 5 percent to 8 percent. The maturity period will be up to 96 months from the date of issuance, with the option for a further 24-month extension at the sole discretion of the company.

However, Shin Hwa World clarified that the bonds will not be listed on the Hong Kong Stock Exchange or any other stock exchange, meaning they will be issued privately and not publicly traded.

The funds raised from the bond issuance will support Shin Hwa World’s ongoing business development, particularly in the integrated resort sector. The company plans to use the capital to expand its resort offerings and explore new growth opportunities.

By issuing bonds, Shin Hwa World aims to enhance its financial flexibility and ensure it has the necessary resources for long-term development.

In the first half of 2024, Shin Hwa World managed to reduce its loss by nearly 32 percent, largely due to an increase in gaming revenue from Jeju Shinhwa World. The company reported a loss of HK$231.54 million ($29.8 million) for the period, despite a 25.5 percent rise in consolidated revenue, which reached HK$418.1 million ($53.8 million).

Currently, the group is looking forward to further developing a residential area within the Jeju Shinhwa World land (zone R) and exploring other opportunities to better utilize the land at Jeju Shinhwa World.

South Korea’s GKL sees net income drop by nearly half in 3Q24

South Korea

Viviana Chan

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November 12, 2024

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South Korea’s GKL sees net income drop by nearly half in 3Q24

Grand Korea Leisure (GKL), South Korea’s operator of foreigner-only casinos, reported a 49.5 percent year-on-year decline in its third-quarter 2024 net income, which fell to KRW6.04 billion ($4.3 million).

The company disclosed this information in its unaudited quarterly financial results, filed with the Korea Exchange on Monday.

On a sequential basis, GKL’s net income for the quarter ending in September was down 46.6 percent compared to the second quarter, when it had reached KRW11.33 billion ($8.1 million).

In terms of overall sales, the company posted KRW93.77 billion ($67 million) in the third quarter, reflecting a 5.1 percent decrease from the previous quarter and a 2.9 percent decline compared to the same period in 2023.

For the first nine months of 2024, Grand Korea Leisure reported cumulative sales of KRW290.54 billion ($208 million), marking a 5.0 percent decline from the same period in 2023, according to the filing.

The operator also reported a 6.1 percent year-on-year decline in casino net sales for the first nine months of the year, which totaled KRW287.3 billion ($206 million). This decline occurred despite an increase in casino drop—the amount customers paid for gaming chips—and a rise in visitors compared to the previous year, according to the company’s supplementary data.

From January to September, the company’s casino drop reached nearly KRW2.77 trillion ($1.98 billion), marking a 13.5 percent year-on-year increase.

Marketing activity expenses, one of Grand Korea Leisure’s main cost items, amounted to KRW47.6 billion ($34 million) in the first nine months of 2024, reflecting an 18.1 percent year-on-year increase.

GKL operates three foreigner-only Seven Luck casinos: two in Seoul, including one in the Gangnam district, and one in Busan, located in the southeastern part of the country.

Paradise Co reports decline in 3Q24 earnings

South Korea

Nelson Moura

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November 12, 2024

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Paradise Co reports decline in 3Q24 earnings

Prominent South Korean operator of foreigner-only casinos Paradise Co has released its financial results for the third quarter of 2024, revealing significant declines compared to both the previous quarter and the same period last year.

For the third quarter of 2024, Paradise Co reported sales of KRW268.2 billion ($192.3 million), a decline of 1.8 percent from KRW273.3 billion ($195.7 million) in the second quarter of 2024 and a 6.1 percent decrease from KRW285.6 billion ($204.2 million) in the third quarter of 2023.

Cumulatively, the company achieved sales of KRW806.3 billion ($577.7 million), reflecting a 7.2 percent increase from KRW752.4 billion ($539.5 million) in the same period last year.

The company operates several prominent casinos, including Walkerhill, Jeju, Incheon Paradise City, and Busan Casino. Paradise Co now plans to enhance its appeal to international guests by developing a luxury hotel in Seoul and upgrading its VIP gaming areas.

Operating income for the current quarter reached KRW36.2 billion ($25.9 million), marking a 13.1 percent increase from KRW32.0 billion ($22.9 million) in the previous quarter. However, this figure represents a steep 36.6 percent decline compared to KRW57.1 billion ($40.9 million) in Q3 2023.

Cumulative operating income stood at KRW116.6 billion ($83.5 million), down 11 percent from KRW131 billion ($94.0 million) year-on-year.

Net income from continuing operations before income tax was KRW20.9 billion ($15.0 million), a 7.0 percent decrease from KRW22.4 billion ($16.0 million) in Q2 2024 and a dramatic 59.6 percent drop from KRW51.6 billion ($37.0 million) in the same quarter last year.

Cumulatively, net income before tax totaled KRW84.3 billion ($60.5 million), down 20.7 percent from KRW106.3 billion ($76.1 million) in the previous year.

Nearly 10K arrested in South Korean police crackdown on youth gambling

South Korea

Nelson Moura

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November 12, 2024

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Nearly 10K arrested in South Korean police crackdown on youth gambling

A recent report from South Korea’s National Police Agency has revealed a troubling trend in underage online gambling, with 4,715 individuals under 19 years old identified as participants during a special enforcement operation from September 2023 to October 2024.

This alarming figure accounts for 47.2 percent of all individuals involved in the crackdown, prompting significant concern among law enforcement and the public alike.

According to Korean news agency Yonhap, over the past year, police have conducted a comprehensive cyber gambling crackdown, resulting in nearly 10,000 arrests, with almost half of those being teenagers.

The National Police Agency’s National Investigation Headquarters announced the arrest of 297 operating organizations and 9,971 gambling participants during a 13-month operation, which focused on cybercrime investigations from September 25, 2023, to the end of October 2024.

Authorities seized KRW126 billion ($90.4 million) in proceeds from gambling crimes.

Initially, the crackdown targeted illegal gambling operations and high-stakes players, but the alarming rise in youth involvement shifted the focus of the campaign. The number of underage gambling cases skyrocketed by an astonishing 2,784 percent compared to just 162 cases reported the previous year.

Among those identified, 17-year-olds made up the largest segment with 1,763 participants, followed by 16-year-olds at 1,241, and 15-year-olds at 560.

The data indicates that online casino games have become the most prevalent form of gambling among youth, representing 82.6 percent of the total cases. The total amount wagered during this period reached KRW3.7 billion ($2.64 million), with the average bet per participant estimated at KRW780,000 ($560).

Notably, a 16-year-old male student reportedly wagered KRW190 million ($136,000) on baccarat, one of the casino games.

Among the arrested adolescents, 4,672, or 99 percent, were classified as simple gamblers. However, authorities also uncovered deeper involvement in illegal activities, including site operation (16 individuals), development and management (13), provision of gambling products (8), and gambling advertisements (6).

By age, the breakdown of participants shows that 17-year-olds accounted for 38 percent, followed by 16-year-olds at 26 percent, 18-year-olds at 11 percent, and even younger ages represented, including 12-year-olds and a 9-year-old elementary school student.

The primary motivations for youth gambling were curiosity (42.7 percent) and peer influence (33.6 percent), with online and offline advertising also playing a role. In response, the police have referred 1,733 minors to professional counseling services, which represents 37 percent of the youth arrests.

The National Police Agency has extended the special crackdown period by another year, emphasizing the seriousness of the youth gambling issue.

‘His vision, tremendous leadership, and guidance were the foundations for the Group’s growth and continued success. Under Dr. Lui’s stewardship, GEG became the first gaming company to be listed on the Stock Exchange of Hong Kong in 2005 and was selected as a constituent of the Hang Seng Index in 2013.’

The announcement also stated that GEG will continue to operate according to the business strategies set by the Board.

The Board believes that Lui’s passing ‘will not have any impact on the operations of the Group.’

‘A new Chairman of GEG will be appointed in due course, and an announcement will be made regarding that appointment.’

The Board expressed its deepest sorrow at Lui’s passing and extended its condolences to his family.

According to Forbes’ Billionaires list, published earlier this year, Lui Che Woo ranked 153rd, with a net worth of $12.1 billion.

Early life

Lui Che Woo was born in 1929 in Jiangmen, Guangdong. He moved to Hong Kong at the age of four. At 13, he was forced to drop out of school due to regional conflicts.

Later, Lui switched to selling car parts. Later, he began importing second-hand heavy machinery to Hong Kong for construction projects, such as road building and quarrying, successfully earning his first fortune.

In the 1950s, he founded K. Wah Group and officially entered the building materials business, gaining the nickname “King of Quarrying.” In the 1970s, he expanded into the tourism and hotel industries.

In the new millennium, Lui’s Galaxy Entertainment obtained a gaming license in Macau, becoming one of the major casino concessionaires and starting his journey as one of Macau’s most influential casino moguls.

Artificial Intelligence and Cybersecurity remain among the top technology trends in 2025. According to the SOFTSWISS survey, iGaming stakeholders rate the importance of AI and Machine Learning as 8.2 out of 10. In 2025, AI will remain crucial for personalisation, problem gambling detection and even decision-making automation.

According to the Splunk survey, 36% of cybersecurity professionals rank AI-powered attacks as a top threat. The fear of AI often arises from its unexplored possibility, but addressing today’s prevalent risks is just as important as preparing for future AI-driven threats. The solution can be investments in AI-powered threat detection systems that analyze large volumes of data in real-time, detect anomalies, and prevent potential fraud.

Regulatory Landscape

The global regulatory framework is marked by growing fragmentation, with each region introducing increasingly specific compliance requirements that span various aspects of business development, from taxation to player protection. In 2025, a company’s ability to swiftly adapt to these regional differences will be crucial to its success in the market.

Marketing: Brand Awareness is a Key

In 2025, brand awareness will be essential for long-term growth, driving visibility and player loyalty. The goal is to create a clear association with a trusted name in online entertainment. Strong brand identity, trust, and high engagement will mark effective brand marketing.

The SOFTSWISS survey participants identified the top marketing channels for 2025: influencer partnerships, affiliate marketing, SEO, and paid advertising. Notably, research across the broader digital landscape shows SEO offers the highest ROI among digital marketing activities, exceeding 29%.

Business Development through M&A

Mergers & Acquisitions have been a significant trend in business development for several years and will continue to be in 2025. Through strategic partnerships or acquisitions, operators can enter new markets, acquire new technologies, or expand product portfolios.

SOFTSWISS, for instance, resorts to this method to enter the South African market and extend its portfolio with new products. The region seems to be a very promising market. Its iGaming sector is expected to reach almost 65 million euro by 2028.

Valentina Bagniya, Chief Marketing Officer at SOFTSWISS, sums up: “Understanding the trends shaping the future of iGaming is essential when planning next year’s strategy. As a leading industry expert and trendsetter, SOFTSWISS recognizes these emerging directions and takes responsibility in offering a visionary iGaming Trends 2025 Report for the needs of the whole community”.

Prepared with the support of eight more brands, the SOFTSWISS iGaming Trends 2025 Report draws upon a comprehensive industry survey, extensive media research, data from the largest Game Aggregator in the market, and SOFTSWISS’ expertise, built over 15 years and enriched by annual interviews with over 1,200 brands. Insights were further enriched by collaborations with leading brands, including SBC, SiGMA, SPRIBE, Oddin.gg, Blask, Boomerang Partners, BGaming and CryptoProcessing, offering a well-rounded perspective on iGaming trends.

Endeavor Group Holdings (NYSE: EDR), a global sports and entertainment company, has announced that it has agreed to sell OpenBet and IMG ARENA to OB Global Holdings LLC.

Table of Contents

What you need to know

On the radar

GALAXY ENTERTAINMENT GROUP

Corporate Spotlight

Industry Updates

Table of Contents

Maybank has revised its net revenue forecasts for Bloomberry Resorts Corporation, lowering its projections by 12 percent for both FY24 and FY25, now estimating PHP51.0 billion ($870 million) and PHP60.3 billion ($1.03 billion), respectively.

Loan refinancing enhances cash flow

South Korean integrated resort operator Shin Hwa World announced on Monday that it plans to issue bonds valued at HK$200 million ($25.7 million) to raise long-term funds for its business development.

Grand Korea Leisure (GKL), South Korea’s operator of foreigner-only casinos, reported a 49.5 percent year-on-year decline in its third-quarter 2024 net income, which fell to KRW6.04 billion ($4.3 million).

Prominent South Korean operator of foreigner-only casinos Paradise Co has released its financial results for the third quarter of 2024, revealing significant declines compared to both the previous quarter and the same period last year.

A recent report from South Korea’s National Police Agency has revealed a troubling trend in underage online gambling, with 4,715 individuals under 19 years old identified as participants during a special enforcement operation from September 2023 to October 2024.

Table of Contents

Galaxy Entertainment Group (GEG) announced that its Chairman and Executive Director, Lui Che Woo, passed away at the age of 95.

Early life

Table of Contents

Which technologies will redefine the future of iGaming? What business models will drive company growth? SOFTSWISS, a prominent tech company with over 15 years of experience in iGaming, unveils its eagerly awaited iGaming Trends 2025 Report.

Technology: Convergence of AI and Cybersecurity

Regulatory Landscape

Marketing: Brand Awareness is a Key

Business Development through M&A

Table of Contents

EvenBet Gaming, a top developer of online gaming software and solutions, is poised to showcase its innovative poker products at SiGMA Europe 2024 in Malta this week.

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