Australian wagering tech company BetMakers Technology (ASX: BET) has signed two-year market access and content agreements with the online British-based bookmaker Bet365 relating to New Jersey and Colorado. As per the agreements, Bet365 will be licensed by BetMakers to offer fixed odds bets on thoroughbred horse racing to Bet365 customers within New Jersey.
Bet365 will also be licensed to distribute BetMakers’ thoroughbred racing content to its customers in New Jersey and thoroughbred and harness racing in Colorado. Bet365 will pay BetMakers a ‘Market Access Fee’ based on a percentage of all fixed odds bets placed in New Jersey on all thoroughbred racing events it offers to its customers and a ‘Content Fee’ based on a percentage of all fixed odds bets placed in New Jersey and Colorado on applicable BetMakers Global Racing Network content. The contracts will run for two years.
Chief Executive Officer, Jake Henson, commented, “We are very excited to be launching fixed odds betting on thoroughbreds in partnership with a leading sportsbook in the US. This is a significant milestone for BetMakers and aligns with our strategy for fixed odds betting on thoroughbreds in the US.”
He added, “The sports betting market in the US is starting to mature and the interest from operators in horse racing as a product is expected to become even stronger. The high frequency of horse racing can deliver high engagement and high-margin returns to operators. We believe the opportunity for both BetMakers and the racing industry more broadly to be significant in the long term.”
BetMakers is a global B2B provider of technologies and services that simplify betting at critical points in wagering. The structure of the market access agreement allows Bet365 to seek BetMakers’ approval to offer fixed odds wagering on third-party global thoroughbred racing content to its New Jersey customers from the many rights holders globally.
In Q3 FY24, the Australian wagering market customers experienced soft trading conditions, impacting revenue. The Q3 revenue of $22.3 million was down 4.1% on pcp. Domestic Australian revenues accounted for less than approximately 25% of the total revenue. BetMakers continues to focus on growing its global revenues and international customer base, with the US being an important market. It closed the quarter with a cash balance of $30 million and an unrestricted cash balance of $18.9 million.
In the same period, AUSTRAC launched a formal investigation into the British gambling company Bet365 to determine whether it is profiting from the proceeds of crime following a lengthy audit. If Bet365 is found guilty of having weak compliance systems, it can face fines worth millions of dollars and greater regulatory intervention.
This contract is the first major operator to enter the New Jersey fixed odds horse racing market. Therefore, the potential revenues that may be generated have yet to be established.
However, BetMakers’ board and management expect these contracts to be material to the Company’s strategic progress. They anticipate that this progress may encourage other operators to enter into similar arrangements with BetMakers, other states to consider fixed odds approvals, and further develop the market and the opportunity of fixed odds on horses within the United States.
Alinda is a Business Reporter for The Sentiment
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