DraftKings Sets It Sights on Entain Takeover

Gambling giant Entain (LON: ENT) has confirmed that US betting company DraftKings (NASDAQ: DKNG) has submitted a takeover proposal for the company. However, the Entain board rejected the initial offer of £25 per share, comprised of cash and stock.

DraftKings wants to buy Entain for £16.40 billion

DraftKings then came back with a revised offer of £28 per share on 19 September. It was comprised of a cash portion of £6.30 per share, with the rest made up of Class A common shares, and the offer represented a 46.2% premium on Entain’s closing share price on 20 September. The offer valued the business at £16.40 billion.

According to the City Code on Mergers, DraftKings has until 19 October to submit a firm offer; however, Entain noted that no such offer may arrive.

The offer was revealed in an update issued by Entain on 21 September, in which the company also spoke about its prospects as an independent business.

The company has a strong track record of growth and runway for further significant growth as set out in the capital markets day on 12 August, with the potential for its total addressable market to grow by more than three times to $160bn. This includes its leadership position in the rapidly growing North American market through its Joint Venture BetMGM. Entain has the most diversified and regulated revenues of any of the global operators and leads the industry in player protection through its ARC program (Advanced Responsibility and Care).

Entain Board Update

This is the second takeover bid for Entain this year after the company rejected an $11 billion bid from MGM Resorts International. At the time, Entain said that the bid undervalued its business, and MGM did not make a higher offer.

The first half of 2021 saw Entain revenues grow by 12.2% to £1.77 billion, and the company’s profit more than double. While there was a drop in revenue from Germany due to the transition to new gambling regulations in the country, Entain brought in £1.56 billion of net gaming revenue after VAT.

More Business News


Leave a Comment

user avatar
My Name United States of America
Your Comment

User Comments

Comments for DraftKings Sets It Sights on Entain Takeover