Scientific Games (SGMS), Endeavor Group (EDR) Both Gain on $1.2B OpenBet Deal
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Scientific Games (NASDAQ: SGMS) gained nearly 6% after-hours Monday after the company entered into a definitive agreement to sell OpenBet, its Sports Betting business, to Endeavor Group Holdings, Inc. (NYSE: EDR) for $1.2 billion, out of which $1 billion in cash and $200 million in Endeavor Class A common stock.
According to Barry Cottle, President and CEO of Scientific Games, this transaction, which is expected to close in Q2/22, is aimed towards maximizing value for the company’s shareholders and rapidly advance its vision to become the leading cross-platform global game company.
Cottle said that this transaction is the culmination of a thorough process to divest OpenBet, one of the world's leading global online sports betting technology companies, and represents a significant milestone towards optimizing the company’s portfolio and de-levering the balance sheet in order to elevate its financial flexibility, positioning the company to invest both organically and inorganically in key growth areas, particularly in content and digital markets.
Shares of Endeavor Group Holdings also surged following the announcement, trading more than 11% higher after-hours.
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