The iGaming industry is on track for a record-breaking year in acquisitions and mergers, with 2024 already positioned as the second-largest year in history by total sales value. Silver Lake’s recent acquisition of Endeavor Group Holdings for $13 billion stands as the largest deal in iGaming history, propelling 2024’s totals close to hitting $16 billion with half the year remaining. This surge in high-value transactions follows a trend of increasing activity, underscoring the sector’s rapid consolidation.
Breaking Down the Data Behind iGaming M&As
The Foundation For the Current Trend: Data From the 00s and 10s
The iGaming industry experienced substantial foundational growth in the 2000s and 2010s through significant mergers and acquisitions. In the early 2000s, notable years included 2006, which saw $5.1 billion in total sales across five deals, highlighted by Lottomatica’s $4.7 billion merger with GTECH. The consolidation trend continued into the 2010s with an increasing number of deals and higher total sales values.
For instance, 2018 was a pivotal year with $9.497 billion in sales, driven by The Stars Group’s $4.7 billion acquisition of Sky Betting & Gaming. The number of deals significantly increased throughout the decade, exemplified by the continuous rise in acquisitions, reflecting the industry’s dynamic nature and the strategic importance of consolidation.
This upward trend in deal volume and value laid the groundwork for the explosive growth observed in the 2020s, with companies increasingly focusing on technological integration and market expansion to maintain competitiveness in a rapidly evolving market.
The 2020s Saw Year-on-Year Records
The 2020s have been a transformative period for the iGaming industry, characterized by a series of record-breaking acquisitions and mergers. This era has seen substantial year-on-year growth in both the number and value of transactions, reflecting the sector’s dynamic nature and strategic shifts.
In 2020, the industry recorded 18 transactions totaling $10.8 billion. Despite the lower volume, the high average deal value indicated significant strategic moves, such as Flutter Entertainment’s $4.2 billion acquisition of FanDuel.
The momentum continued into 2021, with 53 deals worth a combined $11.7 billion. This marked a substantial increase from the previous year, highlighting the industry’s growing consolidation trend. Notable transactions, like Aristocrat’s £2.7 billion acquisition of Playtech, underscored the efforts of major players to solidify their market positions and expand their reach through strategic acquisitions.
The year 2022 set a new record for the iGaming industry, with total sales reaching $19.1 billion across 57 deals. This year marked the highest total sales value recorded so far, driven by major transactions such as Brookfield Business Partners’ $5.8 billion acquisition of Scientific Games’ US lottery business. The high value of these deals emphasized the strategic importance of significant mergers and acquisitions aimed at achieving scale and competitive advantage.
In 2023, the iGaming sector experienced the highest volume of transactions to date, with 77 deals totaling $7.223 billion. While the overall price tag was significantly lower, the extreme jump in the number of deals still showcases a strong trend toward consolidation and strategic mergers. The high transaction volume suggests that many companies want to enhance their market positions, expand their technological capabilities, and enter new markets.
With six months remaining, 2024 is already close to reaching $16 billion, which suggests that it will likely surpass the 2022 record.
Trends and Strategic Implications
The trends above indicate that the iGaming industry is on the brink of a historic year in 2024. The data also highlights several key trends and strategic implications:
Increased Consolidation: The growing number of deals each year, particularly in 2023, indicates a trend towards consolidation within the industry. Companies are merging to achieve economies of scale, enhance technological capabilities, and expand their market presence.
Strategic Positioning: High-profile acquisitions highlight the strategic moves by major industry players to consolidate their positions and enhance their competitive edge in a rapidly evolving market.
Rising Deal Values: The significant increase in total sales value from 2020 to 2022 shows that the industry is seeing more high-value transactions. This suggests a strategic focus on large-scale acquisitions that can provide substantial competitive advantages.
Market Expansion: Regulatory changes are opening new markets for iGaming, prompting companies to acquire local firms to quickly establish a presence and benefit from regional expertise and customer bases.
With 2024 shaping up to be a landmark year for iGaming acquisitions and mergers, the industry is on track to set new records for total sales value. The strategic moves by industry leaders highlight the dynamic and evolving nature of the market, promising continued growth and opportunities in the years to come. The consolidation trend, driven by technological innovation, market expansion, and competitive pressures, is reshaping the iGaming landscape, paving the way for a more robust and dynamic industry.