Entain PLC, the UK sports betting and iGaming group recently targeted for takeover by MGM Resorts, is looking to make a major acquisition of its own after launching an offer for the Wagering and Media business of Australian betting giant Tabcorp.
The offer was first revealed by the Australian Financial Review (AFR) on Tuesday but has since been confirmed by both parties, with Entain issuing a statement to shareholders overnight declaring it “has made a non-binding indicative offer to acquire [Tabcorp’s] Wagering and Media business.
“Whilst discussions are at an early stage, any transaction would be in-line with Entain’s current M&A strategy of expanding across regulated international markets. As such, this would present an opportunity to acquire an attractive business which, if combined with Entain’s existing Australian business, would create a leading, integrated multi-channel and multi-brand wagering company.”
Entain is one of two groups said to be interested in acquiring Tabcorp’s lucrative wagering arm – estimated to be worth almost AU$3 billion (US$2.28 billion) – with the other being a private equity firm according to the AFR.
Should such a transaction proceed, Entain would immediately become the biggest player in the lucrative Australian horse racing and sports betting market where Tabcorp holds 43.7% market share. Entain currently holds about 4% via its local sportsbook Ladbrokes.
Ironically, it was only a month ago that US casino giant MGM Resorts confirmed it had made an offer to acquire Entain in an all-stock deal worth around US$13 billion. Entain rejected that offer and MGM eventually opted against pursuing the matter any further.
In a statement of its own issued Tuesday, Tabcorp said it “confirms that it has received a number of unsolicited approaches and proposals in relation to a potential transaction involving Tabcorp’s Wagering and Media business.
“The proposals were expressed to be confidential, indicative, non-binding and subject to numerous conditions including due diligence, financing and various regulatory approvals. There is no certainty that any transaction will occur.
“The Tabcorp Board is assessing the proposals and Tabcorp will update the market in due course.”
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