Las Vegas-based MGM Resorts International this week gained the first step toward approval of in-house management of its jointly-owned BetMGM retail sportsbooks in Nevada.
BetMGM is a 50/50 joint operation between the U.S. gambling giant and European operator Entain. MGM Resorts will now be employing BetMGM to run the operations of its retail sportsbooks in Nevada, giving the parent company more official direct control and oversight. The background technology will still be run in partnership with Entain.
Licensing issues with the Nevada Gaming Control Board and Entain led MGM to take on its own management of its sports betting properties in the Silver State.
Entain has faced some controversy – and legal action – in recent years over its past grey market gambling operations and alleged money laundering prevention failures. It also recently saw the departure of CEO Gavin Isaacs after just five months in the role.
Representatives from MGM Resorts and Entain spoke in front of the NGCB at Wednesday’s meeting for some 45 minutes, answering questions on the move. The NGCB’s approval is the first step, as the Nevada Gaming Commission will also look at the matter later this month before signing off.
The Changeover
The NGCB made MGM Resorts International apply for a license to run BetMGM’s Nevada sportsbooks. That’s after it became clear that MGM employees were functionally involved in the day-to-day running of the sportsbooks’ operations anyway.
MGM and Entain representatives said that keeping employees entirely separate was operationally more complex than imagined. The logistics were unsustainable of having a branded BetMGM sportsbook in an MGM Resorts casino, but only with specifically licensed staff – many located off-site – technically allowed to be involved with day-to-day decisions.
The NGCB said this situation also led to confusion at the regulator as to who to contact when issues arose with BetMGM retail sportsbooks in Nevada. The operators promised the license change would rectify that.
“The expectation is that BetMGM will have certain high-level functions, including trading, customer service, risk and fraud, marketing, and payments. As the employer, MGM is responsible for oversight and policy direction,” said BetMGM legal counsel Scott Scherer, speaking at the meeting.
“BetMGM will have its own chain of command, but when issues arise, they’ll be resolved by the designated MGM Resorts executive.”
The NGCB also grilled MGM representatives on how changes were made to the Nevada BetMGM app by an out-of-state employee of Entain working for the wider BetMGM operation.
The Nevada app, due to Silver State’s strict licensing laws, is supposed to be separated entirely from the national BetMGM operation unless in areas specifically approved by the regulator.
MGM said it had already fixed those issues, but the new transition would ensure such an incident wouldn’t happen again.
“The key employee license gives us an opportunity to avoid the misunderstandings that have previously arisen with regards to MGM Resorts’ role in the BetMGM race and sportsbook operations,” Scherer said.
If the NGCB’s recommendation for approval is agreed upon by the Gaming Commission, the changeover will take place later this year.
Representatives from both MGM Resorts, BetMGM, and Entain said all three operators agreed the transition would be complicated. So, for that reason, the move has been delayed until after the recent Super Bowl and the future March Madness basketball betting season.
The NGCB is also going through its own restructuring at the moment. The three-member board has recently seen Brittnie Watkins depart and Chair Kirk Hendrick announce his upcoming resignation. Wednesday’s meeting was the first for new NGCB member Chandeni Sendall.
Entain Troubles
This changeover at BetMGM in Nevada might, on the surface, seem to align with the long-held rumors that MGM Resorts may once again look to buy out the joint operation – or even Entain entirely.
However, the details show it is apparently more of a regulatory compliance issue than a disagreement between the companies or a sign of a pending takeover.
Entain is certainly not as attractive an investment as it was shortly after 2019, when the BetMGM collaboration debuted. In fact, in 2021, Entain shareholders rejected an $8.1 billion bid from MGM Resorts.
Since then, the European operator had paid a hefty £615 million (USD$737 million) settlement to the UK’S Gambling Commission. It has had four different CEOs and its share prices have fallen around 70%.
The collaborative BetMGM does continue to do well, however. It recorded a record $2.1 billion in revenue for the full 2024 calendar year, which was up 7% on 2023.
David is an online casino expert who specializes in online slots and boasts over 10 years experience writing about iGaming. He has written for a wide range of notable publications, including eSports Insider and WordPlay Magazine.
David graduated Derby University with a BA Degree in English Literature and Creative Writing.
