British bookmaker enters U.S. market, buys two Nevada sports book operators

American Wagering Inc. of Las Vegas, owner of the Leroy's sports books, is being acquired by British sports betting company William Hill PLC.

William Hill is paying about $18 million for American Wagering and is also buying, for about $21 million, the Club Cal Neva Satellite Race and Sportsbook Division in Northern Nevada.

"We are excited about the expansion of our company into the U.S. gaming market and, in particular, into Nevada, which sets the gold standard. This is a great development opportunity for William Hill, one of the world's oldest and most trusted sports-betting operators, and we look forward to serving the American casino market and reaching out to new customers," William Hill CEO Ralph Topping said in a statement.

The deal for American Wagering gives each holder of common stock the right to receive 90 cents per share. William Hill is also settling about $4 million of debt and preferred shares and is providing a $4.25 million convertible loan to American Wagering.

"William Hill is a U.K. industry leader in sports wagering and online gaming technology. They will provide Nevada gaming customers an unprecedented level of service, along with their cutting edge portfolio of gaming products. This is a great fit for our Leroy's casino and tavern partners, along with the casinos that are served by our sportsbook management technology," American Wagering CEO Vic Salerno said in a statement

William Hill said it is the United Kingdom's leading land-based bookmaker, with sports-betting and gaming in 2,350 licensed betting offices across the U.K. -- 25 percent of the market.

It also owns 71 percent of William Hill Online, an online betting and gaming business.

American Wagering, which employs approximately 200 people, says it is the longest-standing sportsbook operator in Nevada with its "Leroy's" brand dating to 1978

Its proprietary technology is licensed by major casino operators in Nevada and Leroy's operates 72 sportsbooks and kiosks on behalf of other casino operators under the "Leroy's" brand.

For the three months ended Oct. 31, American Wagering lost $226,000 on revenue of $3.6 million.

It has not reported fourth quarter results, but William Hill today said that in the 12 months through Jan. 31, American Wagering's revenue was $14.8 million and EBITDA was $2.1 million.

EBITDA is a profitability measure meaning earnings before interest, taxes, depreciation and amortization.

The Cal Neva Sportsbook Division is part of Sierra Development Co., a privately-owned casino and hotel business, William Hill said.

Established in 1989, it operates 31 sportsbooks in Nevada and employs approximately 120 people. In 2010 its estimated revenue was $10.7 million.

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