Betfair hoping to expand into the US2017-05-30 11:01:21
This decision has been made in the face of intense competition in Europe which could see its lesser rivals either join forces or "wither on the vine," its chief executive Breon Corcoran said on Wednesday.
Current US Presence
The Irish-based group already runs the leading horse racing television and betting network in the United States and operates an online casino business in New Jersey. Last week it bought US fantasy sports company DRAFT in a $48m deal.
CEO Breon Corcoran told reporters: "I think that market has yet to open up properly. I would hope we could do more there, it's a question of legislation and opportunity. There is a lot of appetite to do more if the right thing comes up at the right price,"
A Huge Market
The fantasy sports market is worth an estimated $300m according to Betfair - it offers gambling firms the chance to compete in the US where sports betting is largely illegal.
Earlier in the month, Betfair expressed caution about expansion in its main European market citing "pretty extreme" competition. The market competition has ramped up as firms seek to offset the higher taxes and tighter regulation with increased revenues, leading to a spate of mergers, including the £6bn tie-up between online betting exchange Betfair and Paddy Power. It is hard to see competition abating but growing revenue sensibly and enhancing profitability over the medium term was the right thing to do, Mr Corcoran said. He described his group as "cautious but guardedly optimistic."
Competition is coming from big, well-run operators as well as those "desperate to get bigger", Mr Corcoran said, leading to inflated advertising costs and promotional activity he sees ultimately damaging towards smaller rivals.
Betfair Group plc is the world's leading Internet betting exchange. The company's HQ is located in Hammersmith in West London, England. Since March 2011 Betfair has run its betting exchange under a Gibraltar licence. It was floated on the London Stock Exchange until it merged with Paddy Power to form Betfair on 2 February 2016.
Since Belfair’s inception in June 2000, it has become the largest online betting company in the UK and the world’s largest betting exchange. Betfair boasts over 4 million customers and a turnover in excess of £50 million a week. As of April 2013, the company has over 1,800 people employed worldwide.
Betfair offers on average 20 percent better odds than those offered by a traditional bookmaker. Betfair charges a commission on all winning bets, which is set at 5 percent of the net winnings for most of their markets, although according to how much a customer stakes on the site, it is possible to reduce the amount of commission paid to as low as 2 percent.