L&W completes OpenBet sale, sees opportunity to generate excess capital

Content Team 1 year ago
L&W completes OpenBet sale, sees opportunity to generate excess capital

Light & Wonder (L&W) said it has completed the sale of its OpenBet sportsbetting unit in a move that creates the opportunity to generate significant excess capital.

The company, formerly known as Scientific Games, said it received gross proceeds of $800 million from the sale to Endeavor Group Holdings. A total of $750 million of that was in cash.

L&W said completion of the sale is the final step in a strategic plan that it announced in June last year. 

“With the completion of the OpenBet divestiture and our now streamlined organization, Light & Wonder is well positioned to execute on our growth strategy with a singular focus on building great games fully cross-platform,” said Matt Wilson L&W interim CEO. “With our R&D engine and world class talent at our core, we have an unparalleled ability to leverage our leading industry positions, evergreen franchises and unmatched platforms to drive sustainable differentiation and significant value.”

The company said the sale has helped to transform the company’s balance sheet, providing a clear path to reducing debt to a leverage ratio of 2.5X to 3.5X. The company is targeting AEBITDA of $1.4 billion by 2025. 

L&W eyes expansion, capital return

“Our enhanced financial flexibility accelerates our ability to return substantial capital to shareholders through our share repurchase program, while also pursuing our key growth initiatives, enabling us to unlock tremendous shareholder value going forward,” Wilson said. 

OpenBet is one of the world’s largest sports betting platforms, and sees its tie-up with Endeavor Group Holdings as a key opportunity to capitalize on the growing convergence between sports betting and entertainment.

Endeavor, a global sports and entertainment company and owner of the UFC mixed martial arts company, agreed to buy OpenBet from then Scientific Games last year for $1.2 billion. 

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