MGM Buys Tipico's U.S. Sports Betting Business Operations
MGM Resorts International (NYSE: MGM) unveiled plans to purchase Tipico Group's US iGaming and sportsbook operations.
The specifics of the monetary exchange weren't disclosed. MGM's LeoVegas Group division reveals itself as the acquiring party for these Tipico possessions, having previously purchased LeoVegas in 2022 for over $600 million.
This transaction marks the second major investment by LeoVegas, following the acquisition of game developer Push Gaming in 2023. This acquisition will enable LeoVegas to run a self-developed sportsbook across every international market and brand, except those reserved for the BetMGM JV, accentuating a clean, swift consumer experience with premium product, pricing, and functionality, according to MGM's statement.
Under the conditions of the agreement, Tipico will discontinue its US operations. Selected members from the domestic management, technology, and trading teams of the targets will be joining LeoVegas, and the deal is set to be finalized in the third quarter.
Boosting MGM's Technology with Tipico Acquisition
Based in Germany, Tipico—which is owned by private equity firm CVC Capital—offers sports wagering only in four states: Colorado, Iowa, New Jersey, and Ohio.
Tipico's significance in Iowa and New Jersey is minimal, measured in hundreds of thousands of dollars in some years. In Colorado and Ohio, while Tipico found some success, the revenue never surpassed $10 million in Ohio.
This acquisition isn't primarily geared towards expanding BetMGM's market share but rather bringing more of the operator's technological needs in-house. Entain, which owns half of BetMGM, has been the technology driving force behind the joint venture thus far.
"The acquisition of Tipico's award-winning US platform signifies a significant milestone in the strategic development of MGM Resorts' global digital gaming business," commented Gary Fritz, president of MGM Resorts International Interactive, "With this acquisition, we secure control of our entire technology ecosystem, and we are thrilled to bring Tipico's US team, with their proven record of developing quality products and pricing capabilities, into our business."
End of Long-Lasting Tipico Merger and Acquisition Speculation
Rumors of Tipico's mergers and acquisitions have been persistent. In June 2022, whispers emerged that privately held Fanatics was considering a purchase of the gaming company, but the deal never came to fruition.
In April, whispers suggested that Tipico's US assets were for sale, with MGM assessing an offer. It remains to be seen if CVC decides to sell the rest of Tipico, as speculation arose earlier this year that the private equity firm might sell the gaming company in its entirety.
CVC has been Tipico's majority investor for eight years. It's rumored the private equity firm valued all of Tipico at $3.75 billion.
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