Gambling’s Biggest Merger & Acquisition Power Moves in 2024

Author: Matthew Haynes

Over the last few years, the online gambling industry has been rife with deals. Such has been the sector's growth, especially with new markets opening up, that numerous acquisitions, mergers, and entries into new countries have been made by many different gambling companies.

Indeed, the gambling industry has been significantly shaped by strategic moves which have not only redefined the competitive landscape but also fuelled innovation. In recent years, the sector has witnessed a flurry of high-profile deals as operators, suppliers, and tech companies strive to consolidate and expand in a fiercely competitive market. The trend has only intensified in 2024, with several significant mergers and acquisitions reshaping gambling.

Compared to other industries - especially over the last decade, it could be said that the gambling sector has witnessed more merger and acquisition activity than any others, while still retaining its value. Most deals are seen as profit generators as opposed to cost-cutting measures for many in the industry, with companies keen to buy up top performing competitors.

Gambling Merger & Acquisitions Activity in 2024 vs. Past Years

Perhaps surprisingly, 2024 has been a pivotal year for M&A activity in the gambling industry, marked by a surge in deal volume and value.

What has also influenced the increase in deals over the last few years is the considerable increase in online gambling during the global pandemic, which even led to the regulation of gambling across numerous US states. Furthermore, with some land-based casinos witnessing a decline in foot traffic, operators and suppliers shifted their focus to digital operations, creating a ripe landscape for consolidation as companies sought to enhance their market presence through acquisitions.

Furthermore, the regulatory environment has been a key driver of M&A activity in 2024. Stricter gambling regulations for online operators in Europe, the United States, and Latin America have led to increased compliance costs. This has made smaller operators, struggling to meet these new demands, attractive targets for larger, more established companies seeking to expand their portfolios and capture additional market share.

By comparison, 2022 and 2023 were also notable for M&A activity, but the deals focused more on smaller acquisitions or regional consolidations. In 2024, there has been a significant increase in cross-border deals, with global players actively looking to expand into new territories and enhance their technological capabilities through acquisitions.

The High-Stakes Acquisitions Defining 2024

One of the standout deals of 2024 was the acquisition of 888 Holdings by DraftKings. This merger created a powerhouse in online gambling, combining 888's strong presence in European markets with DraftKings’ dominance in the US. The deal, valued at approximately $2.5 billion, marks one of the most substantial acquisitions in recent years and has significantly altered the competitive landscape. By acquiring 888, DraftKings has gained access to a broad portfolio of online casino and sports betting products. This will help the company significantly expand its reach into new markets in Europe and Latin America.

In addition, Entain made headlines in early 2024 by acquiring Betsson Group for $3.1 billion. This deal is one of the largest acquisitions in the gambling industry and represents a significant move by Entain to strengthen its global market share. Entain’s acquisition strategy has been primarily driven by its ambition to become the dominant player in the rapidly expanding Latin American market, where Betsson already holds a significant presence. As a result, this gaming industry acquisition is expected to substantially boost Entain’s market position and provide it with valuable access to new customer bases in Brazil, Argentina, and Colombia.

A third noteworthy deal in 2024 was Flutter Entertainment’s acquisition of Scientific Games’ online gaming division for $1.8 billion. Scientific Games is known for its cutting-edge gaming software and solutions, making Flutter's acquisition a strategic move to significantly enhance its technological capabilities and expand its online gaming offerings. This deal will give Flutter a competitive advantage in user experience, product innovation, and back-end infrastructure.

These deals indicate a broader trend in the gambling industry, where leading operators increasingly seek to acquire technology suppliers, content providers, and market-leading operators to strengthen their positions. The size and scope of these gambling industry mergers reflect a shift towards more significant consolidation at the top of the market, with the most prominent companies aggressively acquiring their competitors.

Key Drivers of M&A Activity

Several factors will drive a significant increase in M&A activity within the gambling industry in 2024. First and foremost, the rapid digitalisation of gambling has led to a substantial rise in demand for online gambling platforms, creating new opportunities for operators to expand. As a result, many companies are looking to acquire competitors or specialised technology providers to enhance their digital offerings.

Another critical factor is the changing regulatory environment. For example, new regulations governing online gambling have increased compliance costs in Europe, particularly for smaller operators. As such, larger companies with the resources to navigate these regulatory changes are acquiring smaller competitors who may be unable to meet these new demands. The same trend can be observed in the United States, where several states have legalised sports betting and online gaming in recent years. The prospect of substantial new revenue streams from these markets has attracted large operators looking to acquire local brands to gain a foothold in these new jurisdictions.

In addition, the rise of US sports betting continues to be a significant driver of M&A activity. The Professional and Amateur Sports Protection Act (PASPA) repeal in 2018 paved the way for legalising sports betting across multiple states. Since then, sports betting operators have sought to consolidate their positions through strategic acquisitions. In 2024, this trend shows no signs of slowing down, as operators are looking to capitalise on the growing market by expanding their brands and technological capabilities.

Furthermore, the increasing importance of innovation in gambling has also been a driving force. Companies are now seeking to acquire tech firms that specialise in artificial intelligence, machine learning, and blockchain technologies to significantly enhance their products and create new opportunities for player engagement. This trend has been particularly prevalent in 2024, with several operators acquiring tech-focused companies to stay competitive in an ever-evolving market.

Gambling Industry's Race for a Technological Edge

The scale of M&A activity in 2024 has been significantly larger compared with previous years. In 2022 and 2023, the gambling industry witnessed several important deals, but these were often more focused on regional consolidation or acquisitions of smaller operators. In 2024, however, we have seen a significant increase in cross-border deals, with companies looking to expand into new markets, diversify their offerings, and enhance their technological capabilities.

One key difference in 2024 is the substantial rise in deal values. The acquisition of Betsson Group by Entain for $3.1 billion and the DraftKings-888 Holdings merger for $2.5 billion are two of the largest deals in the industry’s history, reflecting a marked increase in the companies' size and the value of the transactions. These deals are emblematic of a shift towards more significant consolidation among the top operators in the market as they look to create larger, more diversified companies capable of competing on a global scale.

Another significant trend in 2024 is the increased focus on acquiring technology providers. As the gambling industry becomes more digital, companies recognise the importance of owning and controlling the technology that powers their platforms. In previous years, M&A activity was often focused on acquiring other operators to gain market share. Still, in 2024, we see a significant shift towards acquiring technology companies that can enhance operators' online and mobile gaming offerings.

The Ripple Effects of Gambling M&A in 2024

The substantial amount of M&A activity in 2024 is expected to have long-lasting effects on the gambling industry. One of the key outcomes is more significant consolidation at the top of the market. As larger companies continue to acquire competitors, the number of essential players in the gambling industry will decrease, leading to increased concentration and greater market power for the remaining operators. This could result in less competition, potentially leading to higher prices for consumers and fewer choices in the market.

However, this wave of consolidation is also expected to drive innovation in the industry. With larger companies gaining access to better technology and resources, we can expect to see more cutting-edge products, particularly online gaming. Integrating artificial intelligence, machine learning, and blockchain technologies will likely result in more personalised and immersive gaming experiences for players.

In addition, the gambling industry's global expansion will continue to accelerate. With companies like Entain and DraftKings actively pursuing cross-border deals, we expect more international operators to enter new markets, particularly in Latin America and Asia. As a result, the competitive landscape is set to become more global, with companies seeking to establish themselves as leaders in emerging markets.

Certainly, the future of M&A activity in the gambling industry looks promising, with more deals on the horizon. As companies adapt to changing regulations, embrace digital transformation, and seek to enhance their technological capabilities, we expect the industry to undergo significant further consolidation. While the most prominent operators are likely to reap the benefits of this trend, smaller companies may need help to keep pace, potentially leading to more acquisitions in the coming years.

Ultimately, the M&A activity of 2024 has been marked by larger deals, increased cross-border acquisitions, and a significant focus on technology. As such, these trends could well shape the future of the gambling industry over the next few years, assisting with both innovation and consolidation in the years to come.