Move made after shares dropped
The owners of UK sports betting operator Betfred have bought a 3.03% stake in William Hill. The Done brothers made the purchase after the rival sportsbook company’s shares fell 2.5% during early trading.
Following the acquisition, William Hill shares rose into the green for a time before dropping 4.2% by the end of the trading day on Monday. Tuesday morning saw share prices go up again by almost 3%.
Reasons for Betfred’s stake purchase
Fred Done, who co-owns Betfred with his brother Peter, gave reasons for the share purchase in William Hill. He told the Racing Post, “I’ve bought Hills (sic) shares because they are massively undervalued and in my opinion when it comes to the US they are front-runners.”
Some analysts are of the opinion that Betfred may be looking to take on William Hill’s retail sports betting operations across the United Kingdom.
Betfred may be looking to take on William Hill’s retail sports betting operations
Since the maximum stake limit on fixed-odds betting terminals was lowered from £100 ($130.40) to £2 ($2.61) in April 2019, a huge number of William Hill betting shops have had to close.
Sportsbook expansion in the US market
Many European sports betting operators have been considering expanding across the US market as more states legalize sports betting.
William Hill is one of the frontrunners in this regard. It had a strong presence in the country before the federal ban was even ended, operating numerous sportsbooks in Nevada for many years.
There are more than 14 states with open legal sportsbooks so far in the US.
Betfred getting in on the action
Betfred has also been eyeing up the American sports betting market. It now has active licenses in Iowa and Colorado, as well as plans in hand to enter Pennsylvania.
The UK-based operator has been ramping up efforts to push its brand in the US. Most notably, it was a major sponsor of the recent Tyson Fury vs Deontay Wilder heavyweight fight in Las Vegas.