RE:More thoughts on Skylmfao
bumblebee99 wrote: Although Rafi and some analysts crowed about this "transformative" acquisition, I am beginning to think that it wasn't as great as people think.
Having had time to mull it over, I feel that TSG made the purchase because they had to.
If you look at their numbers over the past few years, there really has only been very modest growth. Dig a bit deeper, and you'll see that growth has primarily been due to TSG raising rake and cutting benefits. The casino has good margins, but as management has said repeatedly, it cannibalises from poker. BetStars has been a bit of a bust thus far and hasn't moved the needle.
If you are Rafi, how do you grow? TSG was in the unenviable position of being restricted in terms of geographies it could add. The converse started happening, Australia, Poland, Russia, China and others started having legal/payment difficulties, and the US still hadn't opened up (except for NJ, which has been a disappointment thus far).
The only way that TSG would grow would be to acquire a sports betting site and then hope they could convert the acquired players to their casino and poker offering.
Thus, I don't see this acquisition through the lens of anything other than "they had to do a deal" as organic growth would actually start shrinking - or best case, remaining flat - otherwise.