Wynn Resorts (NASDAQ:WYNN) announced Monday it was jumping into the online gambling spinoff game by merging its online betting platform Wynn Interactive with Austerlitz Acquisition Corp I (NYSE:AUS), a special purpose acquisition company, or SPAC.
The casino operator will retain 58% ownership of the gambling platform and will have 70% of the voting rights, so it will be a fully controlled subsidiary of Wynn Resorts.
Wynn Interactive, which it will continue to be called following the merger, offers both casino games and sports betting through its WynnBET, BetBull and WynnSLOTS brands.
Online gambling became a hot ticket for casino operators during the COVID-19 pandemic and they've rushed numerous platforms into the public sphere to capture the market's appetite, especially for sports betting.
DraftKings went public a little more than a year ago via a SPAC merger, and rival Flutter Entertainment is considering taking FanDuel public, too. Casinos are also getting into the act, with Golden Nugget Online Gaming going public earlier this year and Bally's partnering with Sinclair Broadcast Group to bring sports betting and regional sports networks together.
Wynn Interactive is active in 15 states with WynnBET active in six, and it says it expects to gain access to additional states soon. There are currently 21 states with some form of sports betting.
Wynn Resorts forecasts online gambling will become as large as the physical casino market and anticipates it will grow by a compounded 32% rate annually, becoming a $45 billion opportunity over the next five years.
Wynn Interactive will have an enterprise value of approximately $3.2 billion at closing, some 4.5 times its estimated 2023 revenue. The transaction is expected to close by the end of 2021.