People moves

Segev’s departure a blow to more than just Entain

5 minutes read
Shay Segev’s announcement that he was to jump ship to lead sports-streaming company DAZN’s push towards a multi-billion dollar listing will count as a blow to more than just Entain, writes Scott Longley

In the immediate years after the Second World War, the British government seized on what it believed to be an opportunity to steal a march in aviation by forging ahead with plans to build the first generation of commercial jet planes.

The company charged with developing the UK’s jet-age plans was de Havilland and it duly delivered with the Comet in 1952. A sleek, four-engine world-leader, the Comet seemed to herald the dawning of a new age for the UK’s aerospace ambitions. Johannesburg could be reached with five stops in just over 21 hours; Tokyo with nine stops in 46 hours. The globe had shrunk.

But the UK’s ambitions to lead the world weren’t to be. A number of unfortunate disasters in its early years of operation including a mid-air break-up off the coast of Elba lead to the temporary suspension of all Comet flights. Though later versions of the Comet were in service for the next two decades, the earlier vulnerabilities put paid to the UK’s pioneering push. The initiative was handed to Boeing and Douglas who went on to form the backbone of US commercial airliner dominance.

Now a similar sense of a torch being handed over – or more realistically grabbed – pervades the UK online gambling sector right now.

Writing on the wall
Over the course of less than three years, the emergence of state-by-state regulation of sports-betting and online gaming in the US means the centre of gravity has definitively shifted.

Clear signals of this sea change come from the sphere of UK-listed gaming companies. First, late last year William Hill was acquired by Caesars Entertainment in a deal which will soon see the European and international elements of the business jettisoned. This was then followed by the news at the turn of the year of MGM’s bid to buy up Entain, its joint-venture partner in BetMGM.

And while there is still some debate about the price Entain’s shareholder will be willing to accept, the sense that the deal is all but sealed was enhanced by developments this week. In announcing Shay Segev’s planned departure just six months after taking over the reins from Kenny Alexander, Entain made it clear he simply received a better offer.

This is undoubtedly true. DAZN, owned by billionaire Len Blavatnik, was split out of Perform in September 2018. It is rumoured to be taking advantage of the enthusiasm for all things sports-related and will be seeking a £3bn float in London at some point this year. Segev’s appointment will play a central part in this plan.

Given this backdrop Segev’s move is both understandable and inevitable; the awkwardness of the timing is merely coincidence. Except that it also says something about what the UK-based gaming sector in particular can offer an executive versus other related industries.

As one long-standing industry insider put it, Segev’s move is the “canary in the coalmine” for the UK gaming sector. The regulatory backdrop is only likely to deteriorate further following both the government review of the UK Gambling Act and the concurrent but separate UK Gambling Commission consultation on affordability.

An ambitious executive will not be finding abundant opportunities on these shores while the rest of Europe likewise hardly screams for innovation.

Westward ho!
Instead, it is the US where – to coin a phrase – all the action is right now and, to be frank, for the foreseeable future. Late to the online party the US gaming sector may have been but with the bit between its teeth and further sizeable state opportunities all but guaranteed as new states open up in the months and years to come, it is destined to fulfil its destiny and become most important market in the gaming world.

At the end of December when GVC announced its “clear strategy for sustainability, growth and innovation” Segev spoke about the company providing “outstanding career development opportunities.”

For those within Entain, those opportunities will now more than likely be in the gift of the MGM Resorts International HR department based in Nevada.

Those employed within the rest of the European sector, meanwhile, are left with negotiating an increasingly treacherous pathway through the regulatory minefield, all in the knowledge that governments and regulators are actively working towards making the businesses they work in less profitable.

Yes, there are some huge businesses in the European gaming sector and they will baulk at being categorised as being in any way ex-growth. Flutter for one. Gamesys, Bet365, Kindred and 888 to name a few others.

Yet all will likely admit their most exciting opportunities lies westwards. Segev might not be heading in that direction himself but the business and sector he is leaving most certainly is.

Scott Longley has been a journalist since the early 2000s, covering personal finance, sport and gambling. He has worked for a number of publications including Investment Week, Bloomberg Money, Football First, eGaming Review and Gambling Compliance. Scott now runs his own editorial consultancy, Clear Concise Media, and writes for a number of online and print titles.

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