The global sports-betting market is expected to increase by $106.25 billion between 2020 and 2025, a compounded annual growth rate of 10%, according to a recent market study by Technavio.
The Asia Pacific region is expected to register the highest growth rate, nearly 52%. Outside of APAC countries, the report listed the U.K. and France as two of the top-5 growth regions for sports betting.
The sector in the U.S. is growing exponentially as well. In 2021, legalized sports gambling in the U.S. doubled to more than $52.7 billion, according to a Morning Consult report.
Nearly 20% of U.S. adults 21 and older said they bet on sports at least once a month, including online wagering, according to a December survey. That number was up 80% from January 2021.
The number of adults who bet on sports at least weekly more than doubled from 5% of respondents in January to 12% in December.
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The Technavio report notes that the sports-betting market is fragmented with vendors both growing from within and acquiring other companies in the effort to compete.
Casino operator MGM Resorts (MGM) is now looking to M&A as it takes a bigger bite out of the online-gambling market.
MGM Makes Offer for Sweden's LeoVegas
MGM Resorts is making a $607 million, or $6.20 a share, cash offer to acquire LeoVegas AB. MGM says the deal would add to its earnings per share.
"We believe that this offer creates a compelling opportunity that allows the combined teams of MGM Resorts and LeoVegas to accelerate our global digital gaming growth and fully realize the potential of our omnichannel strategy," MGM Chief Executive Bill Hornbuckle said in a statement.
As the largest operator on the Las Vegas Strip, MGM already has a strong position in the U.S. iGaming and sports betting scenes, and the company is looking to expand its footprint in Europe.
"We have achieved remarkable success with BetMGM in the U.S., and with the acquisition of LeoVegas in Europe we will expand our online gaming presence globally," Hornbuckle said.
MGM says the acquisition will provide a unique opportunity for the company to create a "scaled global online gaming business."
MGM says the acceptance period for the offer is expected to start on or around June 2022 and expire in August. If everything goes according to plan, the company expects settlement to begin in early September.
Sports Betting Is Still Growing
Business for the sports gambling industry has been good.
Sports betting accounts for between 30% and 40% of the worldwide gambling market, producing a yield (the money casinos receive from bettors minus the payout) higher than $400 billion in 2021, according to Statista.
In June 2018, sports gamblers wagered $310 million for the month. In October 2021, that number jumped to $7 billion, Bloomberg reported.
Online gambling is starting to catch up, too.
Goldman Sachs predicts the online sports gambling market could reach $39 billion in annual revenue by 2033, up from less than $1 billion in 2021 as more gamblers turn to the online option instead of placing bets in person.
This uptick is directly tied to the 2018 Supreme Court decision to strike down a 1992 federal law that banned commercial sports betting in most states.
That decision allowed online-only sports betting options like DraftKings (DKNG) and FanDuel to proliferate and eventually paved the way for Las Vegas casino companies like Caesars (CZR) and MGM to build their own online betting platforms.
