Ricky ponting beteasy gambling betting
(Image: AAP/Ellen Smith)

Just one day after new data emerged showing that Australians lost a record $24.8 billion gambling in 2017-18, former Australian cricket captain Ricky “Punter” Ponting has enjoyed a multimillion-dollar pay day courtesy of the world’s biggest online gambling company.

The Australian’s Rich List editor John Stensholt was given the drop overnight on a $251 million deal, which will see Canadian giant The Stars Group snap up the final 20% it doesn’t own in BetEasy.

The Stars Group is in the throes of a $23.5 billion merger with Dublin-based Flutter Entertainment, parent company of Sportsbet, which is the largest and most successful foreign bookmaker in the Australian market and has inflicted serious damage on former monopolist Tabcorp.

The Stars Group is currently capitalised at US$7 billion whilst Flutter Entertainment is worth US$9 so with a combined valuation of US$16 billion ($23.5 billion), writing a cheque for $251 million to mop up the Australian minorities in Beteasy is neither here nor there for what will be easily the world’s biggest online gambling company.

The deal marks the fourth $100 million-plus gambling pay day for the father and son bookmaking combination of Alan and Matthew Tripp, who have a 20% stake in BetEasy. Alan started out in life running an illegal SP bookmaking business in Victoria.

The trick for Flutter-Stars will be keeping the notoriously entrepreneurial and competitive Tripp family out of the market and, to that end, the Tripps signed a three year non-compete agreement as part of the $251 million deal.

The Tripps were always very innovative in terms of knowing who to pay and who to partner up with to prosper in the cut-throat and government-dependent gambling business.

Punter emerged with a 1% stake in BetEasy in 2018, five months after James Packer’s Crown Resorts foolishly sold its 62% stake in Crownbet to The Stars Group for just $150 million in a deal that required the Crownbet name to be dropped.

Just a week later, The Stars Group paid US$234 million (A$344 million) to buy William Hill’s struggling Australian business and issued the Tripp-led management team with 3.1 million Stars shares in exchange for snapping up an extra 18% of Crownbet from them, lifting Stars Groups’s overall stake to 80%.

With shares in The Stars Group closing at US$24.29 overnight, those 3.1 million shares are now worth $110 million, suggesting that the Tripp family significantly out-played James Packer.

Crownbet was using Ponting for its advertising when James Packer controlled the business but had never contemplated cutting him a slice of the equity. The Australian broke the story of Ponting’s 1% stake in BetEasy in August last year, reporting that it was nominally worth $1.4 million at the time.

Whilst the Tripps are now worth more than $500 million, the pay day for Ponting could be high as $12.5 million, although it depends how the money flows from the deal announced overnight.

There are two components. Firstly, The Stars Group is paying $151 million for the 20% of BetEasy that it doesn’t own. If Ponting owns 1% of the 20%, it means he’ll be pocketing 5% of that $151 million, or some $7.55 million.

The second component is a $100 million payment to buy out management’s entitlement to a share of future profits, which presented as a maximum liability of $232 million for The Stars Group and was payable next year depending on profitability.

If Ponting is deemed to be part of the management team — and the formula was the same as with the equity holdings — then he would be up for another $5 million pay day. It is not clear if Ponting paid anything for his shares or instead accepted them as full payment for advertising services rendered for the big effort required to launch the BetEasy brand.

Ponting also does paid project work for Cricket Australia, such as the dressing room presence during this year’s Ashes series in England, plus has been paid handsomely by Seven, Ten and News Corp’s Foxtel for commentary services over the years.

The Ponting pay day comes as Cricket Australia shows signs that it is aiming to become Australia’s most enlightened major sporting code on the question of gambling sponsorship. CEO Kevin Roberts revealed last week that it had knocked back a lucrative gambling sponsorship of the Big Bash League, raising expectations that it will also choose not to renew its $5 million annual deal with Bet365 when it expires in the next two years.

The AFL is also wrestling with whether to renew its $10 million-a-year deal with BetEasy, which has been delayed by the proposed Flutter-Stars merger as it is unclear which brands the combined business will keep in the Australian market.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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