Caesars Entertainment, Inc. has officially announced an agreement to acquire WynnBET and its Michigan iGaming business operations as the latest major sports betting operator to join the iGaming industry. In addition, Caesars signed a long-term extension to gain iGaming market access rights with Michigan’s Sault Ste. Marie Tribe of Chippewa Indians.
Once regulatory measures are approved for this transaction, Caesars will be able to access the Sault Tribe’s iGaming skins, allowing Caesars to operate with more digital brands within Michigan’s borders. Current WynnBET users will be brought into the revamped Caesars Michigan iGaming platform. Caesars and Wynn both qualify to get non-cash considerations, such as extinguishment, reductions, and assignment of certain contractual obligations as they relate to both parties and their various businesses.
iGaming growth
Major online sportsbook operators are being proactive when it comes to striking deals with iGaming businesses. Recently, DraftKings announced an agreement to acquire Jackpocket Inc. in a $750 million deal, gaining access to leverage the current U.S. lottery industry market. It’s a market that contains plenty of customers who don’t have an online sportsbook account either due to being physically present in a state without legal sports betting or because DraftKings doesn’t hold a current license to operate in a particular state.
FanDuel acquired BeyondPlay in a deal announced Wednesday.
Another study commissioned separately by iDEA through Eilers & Krejcik Gaming (EKG) shows the disparity between online casino customers and land-based casino customers in terms of revenue and overlap. Its results reveal that online casinos have a younger customer base compared to brick-and-mortar casinos, however, states with both legal land-based casinos and iGaming markets draw much more revenue than states with only brick-and-mortar casinos.
Only 7% of customers in the study played both iGaming markets and physically at land-based casinos. With nearly two-thirds of online casino customers being a significantly younger demographic, there is minimal cannibalization, allowing both online casino and brick-and-mortar businesses to generate revenue without cutting into the other’s profits.
Caesars iGaming transition in Michigan
Caesars expressed excitement over the latest agreement struck with WynnBET.
“As we continue to grow our iGaming franchise, the assumption of WynnBET’s iGaming operations in Michigan allows us to tap into a significant market and customer base, providing a crucial step forward in growing our digital products and offering players more ways to play,” said Caesars Entertainment SVP and chief iGaming officer Matt Sunderland in a release.
Now, Caesars has the ability to leverage WynnBET’s iGaming operations by expanding even further into one of the biggest online casino and iGaming markets in the country. Caesars’ goal is to continue operating its online sportsbook, Caesars Sportsbook, and Caesars Palace Online Casino, but it will transition Wynn’s iCasino operations in Michigan later in 2024 into one of its flagship gaming brands under Caesars’ extensive portfolio.
“It was paramount that our next partner in iGaming possessed both expertise in the U.S. iGaming market and a history of strong partnerships in Indian country," said Austin Lowes, chairman of the Sault Ste. Marie Tribe of Chippewa Indians. "We believe we found that with Caesars and look forward to being part of their new iCasino offering.”
Currently, the Tribe owns and operates five brick-and-mortar casinos, Kewadin Casino, throughout the Upper Peninsula of Michigan.
