Churchill Downs Inc. has entered into an agreement to acquire advanced-deposit wagering company Youbet.com Inc. for $126.8 million.
Youbet delivers horse racing online to consumers in the United States and is exclusive provider of horse racing content to CBSSports.com and CBSSports.com. Youbet’s United Tote subsidiary supplies totalizator systems, equipment and technology that process wagers and payouts and is a provider of pari-mutuel tote services to racing operations that include leading racetracks such as Aqueduct, Belmont, Churchill Downs, Keeneland and Saratoga.
Youbet reported handle of $438 million and revenue of $85.8 million in 2008, and reported $374 million in handle and $70.8 million in revenue through the first nine months of 2009.
In announcing the merger, Churchill Downs noted that while less than 14 percent of all wagering on U.S. Thoroughbred racing is currently placed online, they expect that percentage to grow, based on online trends seen in other industries.
Churchill President and Chief Executive Officer Robert L. Evans said, “We believe this combination should enable us to accelerate the development of new technology-enabled features and services that horse racing customers who wager via the ADW channel want, and that can attract new customers to racing.”
The transaction is expected to close by the second quarter of 2010.