TOP NEWS: Entain Confirms Potential Takeover Offer From US Partner

(Alliance News) - Entain PLC on Monday confirmed a press report that it has received a possible ...

Alliance News 4 January, 2021 | 8:47AM
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(Alliance News) - Entain PLC on Monday confirmed a press report that it has received a possible takeover offer from its partner, a US casino operator, MGM Resorts International.

If a deal is concluded, Entain would become the second UK gaming operator, after William Hill PLC, to be taken over by its US partner.

Back in September, William Hill agreed to a GBP2.9 billion takeover by US casino and resort operator Caesars Entertainment. And in December, Paddy Power owner Flutter Entertainment struck a USD4.18 billion deal to own nearly all of the US FanDuel gaming business.

The Wall Street Journal on Sunday, citing sources familiar with the matter, had said MGM was looking to buy Entain which had a market capitalisation of about GBP6.63 billion last week.

The WSJ said the value of the bid was above GBP12.85 per share. Entain shares closed at 1,133.50 pence on Thursday. On Monday, the stock was up 27% at 1,435.00p a share, giving the company a market cap of GBP8.42 billion.

On Monday, GVC, formerly known as GVC Holdings, said MGM Resorts proposed an offer of 0.6 of a MGM share for each Entain share.

Based on closing prices on Thursday last week, being the last trading day prior to this announcement, MGM Resorts' proposal represents a value of 1,383p per Entain share and a premium of 22% to Entain's share price on New Year's Eve.

Under the terms of its most recent proposal, Entain shareholders would own just shy of 42% of the enlarged company. Entain said MGM has indicated that a limited partial cash alternative may be offered as well.

Entain, however, said it told MGM Resorts that the bid "significantly undervalues the company and its prospects".

"Entain shareholders are encouraged to take no action," the company added. MGM Resorts has until February 1 to make a firm offer or walk away.

By Evelina Grecenko; evelinagrecenko@alliancenews.com

Copyright 2021 Alliance News Limited. All Rights Reserved.

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