Tennessee’s sports betting industry hit a historic milestone in November, as the state reported a staggering $517 million in gross wagers, marking the first time the monthly handle surpassed the $500 million mark since the launch of sports betting in November 2020.

Tennessee’s Sports Betting Hits All-Time Peak with 16.16% Surge in November

The Tennessee Sports Wagering Advisory Council (SWAC) released the figures, revealing a 16.16% increase from the previous month’s total bets of $445.19 million in October 2023. This notable surge comes as no surprise, with the peak of the 2023 college football and NFL season contributing to the heightened betting activity.

The state also witnessed a substantial 17.68% year-over-year increase in handle, showcasing the continued growth and popularity of sports betting in Tennessee. The monthly sports betting handle for November 2023 now stands as the highest in the state’s history.

Tennessee’s sportsbooks generated $1.63 million in adjustments, reflecting an impressive 178% increase from the preceding month. Despite this robust monthly growth, the figure represents a 22.37% decrease compared to November 2022, which saw adjustments totaling $2.10 million.

The Volunteer State’s sports betting journey has seen remarkable growth, rebounding impressively from a record-low revenue of $10.1 million in August 2021. The recent surge in sports betting activities aligns with the entry of prominent platforms such as Fanatics Sportsbook, ESPN Bet, and Hard Rock into the Tennessee market in the last two years. Major players like FanDuel, DraftKings, and BetMGM also went live in 2020 when sports betting was legalized.

Tennessee’s Bold Tax Strategy Nets $9.51 Million

In a unique approach to taxation, Tennessee has been the sole state taxing sportsbook operators based on their total betting handle since July 2023. The state imposes a 1.85% tax on the entire amount wagered. This shift aims to eliminate financial risks, ensuring Tennessee consistently receives privileged tax revenue from all sportsbook operators.

As a result of November’s unprecedented betting activity, Tennessee collected over $9.51 million in privilege fees, marking a 16.16% increase from October this year and a 5.36% rise from November the previous year.

At the beginning of June, Tennessee Governor Bill Lee signed Senate Bill 475 into law, making the state the first in the US to tax sports betting operators based on their betting handle rather than revenue. The legislation, effective from July, replaced the current 20% tax on gross gaming revenue with a 1.85% tax on the monthly betting handle, eliminating the requirement for operators to hold 10% of their handle. The renewal license fees also shifted to a multi-tier system based on operators’ betting handle, aiming to boost tax revenue for various state programs.

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Earlier this month, Lottomatica, an Italian gaming giant, announced its plans to acquire 100% of SKS365’s share capital. The deal, which values the latter business at €639 million ($702 million) was signed recently and, if cleared by all relevant regulators, is set to close in the first half of 2024.

As a result of this major move, Lottomatia announced its plans to issue €500 million (approximately $549.1 million) in debt notes to fund the agreement. A first row of floating rate senior secured notes will be issued, followed by a second tranche of fixed rate senior secured notes. The latter notes will have a fixed rate of 7.125%. The move is also part of a €565 million 7.125% Senior Secured Notes due 2028 bond.

The division between the two bonds is yet to be announced and will likely be communicated once Lottomatica closes the deal or around the date of the completion.

In addition to that, Lottomatica has secured revolving credit cash borrowing of €50 million (roughly $55 million), under an existing revolving credit agreement.

The money Lottomatica secures through the notes and borrowings will allow it to fully fund the SKS365 purchase deal and cover all applicable fees and costs.

Lottomatica Is Looking Forward to Closing the Deal

Lottomatica will acquire SKS365 through its wholly-owned subsidiary CBO Spa. The successful deal comes in the wake of a failed takeover attempt by Playtech, which gave up on acquiring SKS365 recently. At the time, Flutter Entertainment was also rumored to be eyeing a takeover of SKS365’s business.

Guglielmo Angelozzi, Lottomatica’s chief executive officer, believes that the acquisition of SKS365 will provide CBO and Lottomatica with a major boost in Italy. As a company with over 1,000 shops and a significant online presence, SKS365 is an undeniably popular brand among local customers.

Angelozzi praised SKS365 as a top performer and lauded the efforts of its management team, which turned it into a local powerhouse.

Alexander Martin, SKS365’s CEO, also commented on the matter earlier, saying that his team is glad to join the Lottomatica family and believes that it could not have found a better acquisition partner.

For reference, SKS365 operates brands such as PlanetWin365 and PlanetPay365 in addition to running retail operations. Furthermore, the company has been decorated as one of Italy’s top employers for 2023.

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