Super Group Holding Co. seeks to make its U.S. sports betting ambitions a reality by combining with Sports Entertainment Acquisition Corp. to float a global online sports betting and casino company on the New York Stock Exchange (NYSE). Super Group owns online sports betting and gaming brand Betway, and Spin, a multibrand online casino offering.
Targeting the fast-growing U.S. online sports betting niche, Super Group will go public in a SPAC merger deal that values the company at a pre-money equity valuation of about $4.7 to $5 billion. Shares of the joint company will trade on the NYSE as SGHC.
Although current shareholders of Sports Entertainment Acquisition Corp will own 9.3% of the new company, investors looking to take advantage of the online gambling surge can use our guide to learn how to buy this stock eyeing a listing via a SPAC deal.
Super Group Financial History
Super Group (SGHC) is the parent company for top global online sports betting and gaming players: Betway, a global online sports betting brand, and Spin, an online casino offering. The company is licensed in 23 jurisdictions, with top positions in key markets throughout the Americas, Europe and Africa.
The group took in more than $42 billion in wagers in the 12 months ending March 2021 and currently has over 2.5 million monthly unique active customers. Eyeing the fast-growing U.S. online sports betting and gaming market, Super Group has also drawn an agreement to acquire Digital Gaming Corporation, which will give the group access to an initial 10 U.S. states and complement its global growth strategy.
The group draws the success of its sports betting and online gaming offerings from its scale and leading technology, allowing for fast and effective entry into new markets.
Super Group — which will emerge debt-free and have approximately $200 million in cash on its balance sheet at the closing of the merger transaction — delivered $1.1 billion in net gaming revenue and $259 million EBITDA in 2020 on a pro-forma basis. The group’s revenue in 2020 was split as follows: 48% in the Americas, 21% in Europe, 12% in Africa and 18% in other regions.
The group’s forecasts for upcoming fiscal years include net gaming revenue of more than:
- $1.5 billion and EBITDA of over $350 million in 2021
- $1.7 billion and EBITDA of over $420 million in 2022
These forecasts estimate a compounded annual revenue growth of 23.1% from fiscal 2020 to fiscal 2022.
Super Group Potential
Although public debuts don’t always go according to the hype, Super Group has several tailwinds that eliminate any lingering doubts about the debut train.
The Betway Brand
Betway is part of Super Group — a global digital company providing first-class entertainment to the worldwide betting and gaming community.
Betway currently has over 60 brand partnerships with multiple teams, leagues and sports personalities across the globe. These include global leading franchises like the U.S. NBA teams Golden State Warriors, Chicago Bulls and Brooklyn Nets; English Premier League football team West Ham and the esports team Ninjas in Pyjamas.
COVID-19 lockdowns accelerated online sports betting and Betway should place Super Group in an ideal position to capitalize on the forecast growth in the global online betting and gaming market, which is projected to exceed $100 billion by 2025, according to H2 Capital.
New Partnership with the NHL
On May 14, 2021, Super Group’s online sports betting brand Betway, announced that it had entered into a multiyear U.S. partnership with the National Hockey League (NHL). This deal makes Betway NHL’s official sports betting partner and represents the brand’s premier sports betting partnership with a North American professional sports league.
This partnership will see Betway receive significant brand exposure on a global scale through signage placements for all games of the 2021 Stanley Cup Playoffs and 2021 Stanley Cup Final and will extend through the duration of the partnership. Betway will also get exposure at NHL tentpole events, including the NHL Stadium Series, NHL Winter Classic and NHL All-Star Weekend.
Proven Success of Entry into new Markets
Through tailored marketing, robust technology and global brand strategy, Super Group maintains a solid track record of profitably entering markets and building leadership positions in different jurisdictions globally. It’s already licensed in 23 jurisdictions across the globe, excluding the U.S.
How to Buy Super Group Stock
If you already know how to buy stocks, the process of buying an IPO isn’t any different, except you won’t access the stock until it floats on a public exchange. Here’s how to own your share of this stock.
- Pick a brokerage.
The first step to owning a share of any stock is always the same — you need to select a broker that will be a custodian for your shares. While the criteria for choosing a broker are often highly personalized, most brokers now offer similar features and incentives to their members, including commission-free trades, ample research and educational offerings and access to various markets.
Even so, your preferences and the type of trading you want may help you narrow down your options. Are you a beginner stock trader? You’ll probably want to pick a broker that offers a paper trading account that lets you try out a few strategies before trading with real money. Are you into active day trading or swing trading? You want a high-powered brokerage platform with robust charting tools.
Use our list of best brokers to narrow down your options.
- Decide how many shares you want.
As obvious as this step seems, you’ll need to decide the number of shares of the upcoming Super Group IPO to purchase. More importantly, you’ll need to have this figure before the opening session. But how do you calculate the number of shares? Start by taking the amount of money you’re willing to invest and the anticipated initial price.
SPAC IPOs typically have an initial price of about $10 per share, though there are a few exceptions. The blank-check company Sports Entertainment Acquisition Corp. (NYSE: SEAH) is currently trading at around $10, so we’ll use that as a starting point. If you’re willing to put $1,000 in the Super Group IPO, then you’ll own about 100 shares of the stock.
If you’re impressed by the stock’s outlook, the provision of fractional share ownership by most brokerages should let you make small incremental purchases on the go.
- Choose your order type.
You’ll be able to choose from the following order types when you place a stock order through most brokerages:
Market order: A market order is probably the first thing that comes to mind when you think about buying a stock. It’s a basic request to buy a stock immediately. The price that you pay for is usually the same or close to the quote when you place the order. A market order will execute almost instantly if the security is actively traded and the market conditions allow.
Limit order: This is an order to buy a specific quantity of a security at or below a specified price. This ensures you won’t pay more for the stock than whatever price you set as your limit.
Stop order: A buy stop order sets the buy price of a stock above the current market price, therefore letting you buy only at a specific price. Your order will execute when the market price touches or goes through the buy stop price.
Stop limit order: A stop-limit order combines the features of a stop and limit order. It executes at a specific price or better after a stock reaches a specific stop price. Once this price is reached, a stop-limit order becomes a limit order to buy at the limit price.
More complex order types let you set the duration of the order as well as other special conditions like All-or-None or Opening Price.
- Execute your trade.
Once you’ve settled on an order type, hit the Buy button and relax. For a market order, funds will be deducted from your account and the stock purchased will appear in your positions. Although trading is largely done between 9:30 a.m. and 4 p.m. EST, so brokerages let you trade the major exchanges and selected listed securities after the normal market hours.
Best Online Stock Brokers
An Intriguing Debut
Online gambling is creating tailwinds, and coronavirus-related lockdowns helped push its popularity. In the United States, the industry is growing rapidly on the backdrop of the legalization of sports betting. All odds seem to favor this debut, and its U.S. market growth plans are complemented by Eric Grubman and John Collins who bring a wealth of experience and relationships within the larger sports and entertainment ecosystem.
Because Super Group has strong financials, it carries a serious potential. On the flip side, tread with caution since the company must battle it out with competitors like Flutter Entertainment and DraftKings Inc.