American casino operator Wynn Resorts Limited wants to sell its subsidiary Wynn Interactive Limited for just $500 million, according to a report in the New York Post, months after it offered to put the online sports venture up for sale with a valuation of $3.2 billion.
According to a report in the New York Post, the Las Vegas-headquartered company is selling a subsidiary to potential buyers at a steep discount, even though the subsidiary recently obtained a New York license to provide online sports betting services under the WynnBet brand. The source said the move comes just six months after the subsidiary struck a deal with National Basketball Association legend Shaquille O'Neal as an official brand ambassador.
Rapid growth:
Wynn Resorts Limited opened its Wynn Interactive Limited division in November 2020, and its mobile online betting service WynnBet has subsequently been licensed in the U.S. states of Arizona, Colorado, Indiana, Michigan, New Jersey, Tennessee and Virginia. Despite all this, the newspaper reports that the company is rumored to be making significant losses because of high tax rates and providing customers with attractive promotions.
Financial scare:
Matt Maddox (pictured) is the CEO of Wynn Resorts Limited, and he reportedly used a November conference call with investors to explain that WynnBet's service from Wynn Interactive Limited expects losses of up to $100 million in the third and fourth quarters. The outgoing boss also allegedly said that the U.S. online sports betting market is "really unstable" right now, and his company is not interested in throwing good money at bad right now.
Maddox stated.
"Competitors are spending too much to attract customers, and the economy is not something we're going to get involved in."
Depressing depreciation:
The New York Post reported that the revelation immediately caused international brokerage and investment firm Morgan Stanley to downgrade the total value of Wynn Interactive Limited to $700 million and predict that its WynnBet service would likely provide only a 2.5 percent share of the North American sports betting market. In contrast, the newspaper noted that competitors DraftKings Incorporated and FanDuel Group currently control a large portion of the market and recently offered sign-up bonuses of up to $1,000 to new players with new https://3dpdanmark.dk/party-casino-bonuskode/.
Big Attention:
The newspaper reported that Wynn Interactive Limited is responsible for the mobile-friendly services of WynnSlot.com and BetBull.com and is now likely to attract interest from a wide range of potential buyers, including Fanatics Incorporated and Penn National Gaming Incorporated. David Katz of U.S. brokerage Jefferies Financial Group Incorporated allegedly remarked that it should come as no surprise that most American players are taking advantage of the stock and taxes offered by national online sportsbook operators, despite the punitive nature of these deals at the corporate level.
Katz reportedly told the New York Post
"Operators keep telling us that they have mathematical models that give them a reason to believe they are spending money wisely, but Wall Street doesn't believe them. The way Wall Street sees the future has changed in the last three to six months, and there was certainly a lot of enthusiasm, but the wind has quickly changed."
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