William Hill Exits Spanish Market

William Hill plc exited from the Italian market last year, and closely following on the heels of that departure is the latest announcement on Thursday that the company is to withdraw from the Spanish market - its joint venture with Codere, citing regulatory and economic concerns.

William Hill and Codere had been in discussions since early this year regarding the future strategic direction and capital requirement of their joint venture - Victoria Apuestas - which currently operates across 98 locations in the Madrid and Basque regions of Spain.

William Hill said that the success of the Victoria business has always been dependent on achieving sufficient scale, which has been severely hampered due to the slow granting of local regulatory consents and the slower-than-anticipated regulatory changes in the other regions of Spain.

The company said that these regulatory concerns, combined with the difficult economic climate in Spain, were likely to lead to additional capital requirements from the company and which will, in turn, further delay in achieving William Hill's target return for the venture.

In the first quarter of this year, sports betting operating revenue from the Victoria JV amounted to €0.8 million, with negative EBITDA of - €1.0 million.

William Hill said that while it would continue to provide bookmaking services to Victoria, but its international sports betting strategy would now be mainly focused on the internet via William Hill Online, which last month reported double-digit growth in the number of bets and turnover. This double – digit increase was mainly due from its new Orbis powered sportsbook.

The company added that the withdrawal from the Spanish market, from the joint venture with Codere, is not expected to have an impact on the Group's expectations for the year 2009.

Written for Online Keno by Joy