[ad_1]
Entain, the gambling company behind Ladbrokes and Coral, has received a $ 20 billion takeover approach from DraftKings – the latest blow from a US rival.
Entain shares jumped nearly a fifth on news of the US sportsbook’s cash and stock offering, making it the biggest gain among shares on the FTSE 100 and giving the company has a market value of over £ 13 billion. Before the offer was announced, Entain had a market capitalization of around £ 11 billion.
The offer justifies Entain’s decision to reject a £ 8.1 billion buyout offer from US partner MGM Resorts, which owns casinos including the Bellagio in Las Vegas, in January. The two companies continue to operate an online sports betting partnership in the United States called BetMGM.
“Entain’s board of directors confirms that it has received a proposal from DraftKings to acquire Entain, the consideration of which would include a combination of shares and cash from DraftKings,” the company said in a statement. He did not disclose the price of the approach and added that there was no certainty that a deal would be made.
DraftKings’ offering, which operates fantasy sports and betting in the United States, values the company at around £ 25 per share and is mostly equity. DraftKings shares fell 6.4% following the announcement of Entain’s offer, valuing the company at around $ 22 billion. DraftKings’ market value has almost increased sevenfold since it was listed at a valuation of $ 3.3 billion in April of last year through a merger with a special purpose acquisition vehicle.
Entain, which owns a host of online betting brands including bwin, sportingbet and PartyPoker and more than 3,300 bookmakers, is the latest UK gambling company to be targeted by an American rival as the advent of betting legal sports are fed state by state. a flurry of offers. The company was renamed GVC Holdings last year, following the retirement of its colorful CEO Kenny Alexander.
“It was the US sports betting company of Entain with MGM that caught the attention of DraftKings,” said Nicholas Hyett, equity analyst at Hargreaves Lansdown. “The rapid growth of a booming market itself is making Entain hot stuff. A later split or sale of more mature assets, as we saw with William Hill, would likely follow. “
Last September, US casino operator Caesars reached $ 3.7 billion (£ 2.9 billion) to buy William Hill with a focus on rapidly expanding its online betting business in the States. -United.
Earlier this month, UK online casino company 888 Holdings confirmed its £ 2.2bn purchase of William Hill International from Caesars, which did not want to retain the 87-year-old UK company’s brand. , its 1,400 betting shops or its non-US online operations.
Demand for online betting has increased during the long pandemic lockdowns over the past 18 months as punters have found themselves stranded at home and new players have emerged.
Since the US Supreme Court legalized sports betting in 2018, a number of UK companies have started operations in the US, but state laws require them to have a US partner, who typically owns the sports betting licenses.
Sign up for the daily Business Today email or follow Guardian Business on Twitter at @BusinessDesk
Flutter, the London-listed parent company of gambling brands including Paddy Power and Betfair, has merged its US operations with US betting company FanDuel.
In April, Rupert Murdoch’s Fox launched a lawsuit against Flutter in a dispute over the value of the company’s stake in FanDuel. Fox, who has an option to buy an 18.6% stake in FanDuel, believes he should be allowed to do so at the same lower price Flutter paid last year and not the higher price the company is at. valued currently, while betting is booming.
Flutter plans to list part of FanDuel, which is the largest operator in many US states that have deregulated sports betting.
Entain shares closed up 18.3% at £ 22.61 per share, with a market value of £ 13.27 billion.
Source link
