Las Vegas Sands is now readying itself to enter into sports betting market of the United States.
This is the departure from the stand against online gambling that was earlier displayed by Sands’ founder.
Understanding the current trend, which is largely inclined towards online gambling and betting, Sands Group’s President Rob Goldstein who now is acting CEO/chairman is reportedly in talks with unspecified number of prospective sports betting technology partners.
The shares of the Casino operator spiked a little after breaking of the news but closed on 0.4%.
However, there has been no official confirmation of the news by any of the Sands’ authorities.
The decision of Las Vegas Sands to enter the online betting market stems from the revenue derived by operators in the States of New Jersey and Nevada.
New Jersey became America’s top betting state in the year 2020 where 93.6% of the revenue was generated from its digital sportsbook component. New Jersey overtook Nevada in the record revenue generation.
Since the 2018 Supreme Court ruling on the Professional and Amateur Sports Protection Act (PAPSA), LVS stands as the only major domestic US casino operator without some online sports betting exposure. The company’s sports wagering offerings are confined to a William Hill sportsbook at the Venetian on the Las Vegas Strip and kiosks at the neighboring Palazzo.
LVS’s potential change of stance on sports wagering comes as rivals, such as Caesars Entertainment, MGM Resorts International, and even Wynn Resorts are increasingly prominent players in the fast-growing industry.
In terms of a potential online offering, LVS is certainly late to the party. In that sense, they may look to partner with an existing operator, perhaps via direct investment, rather than trying to play catch-up to the likes of FanDuel, BetMGM, and DraftKings,” said RoundHill Investments co-founder Will Hershey in an interview.
Often touted by analysts for having one of the strongest balance sheets among casino operators, and with a market capitalization of $44.42 billion, LVS has the resources to consider a sports betting acquisition. Cementing a deal to sell the Venetian, Palazzo, and Sands Convention Center on the Strip would bring in more cash, perhaps as much as $6 billion. But there’s currently no talk that the company is considering a takeover as a sports wagering entry.
Las Vegas Sands owns five integrated resorts in Macau and Marina Bay Sands in Singapore, and those are the company’s two largest markets in terms of revenue and earnings before interest, taxes, depreciation and amortization (EBITDA).
Its US exposure is confined to the aforementioned Strip venues. But with rumors of sales of those assets intensifying, some industry observers believe that’s a commentary on Sin City’s recovery trajectory from the coronavirus pandemic.
Should Sands proceed with divesting those venues, it could use the cash to enter New York, where sports wagering is permitted, and Texas, though the Lone Star State is a longer-term objective because the state has limited casino gaming and doesn’t allow sports wagering.
“A combination of improved regulatory momentum in states like New York and increasing valuations for online operators has likely weighed on their decision to reconsider,” said Hershey. “The longer the pandemic rolls on and retail operations suffer, the more pressure there is on LVS to enter online.”