DraftKings rumoured to test Entain’s resolve with a bid double previously posted by MGM. (Image from entaingroup.com)
The wave of US buyouts of UK betting companies seems to show no signs of letting up as rumours continue to circulate that a bid for Entain, the gambling firm behind Coral and Ladbrokes, looks likely soon. 2020 was not a good year for many but with Entain’s stock value plummeting to as low as 300p briefly in March of that year, it’s no surprise to learn that the company’s joint venture partner in the US, MGM Resorts, took a stab at acquiring Entain for £8.1bn or £13.83 a share in January of this year. Chairman Barry Gibson could see the bigger picture and turned down that offer and now with the company looking at a value of more like £25 a share or £14.6bn, it seems his gamble may have paid off with reports of interest from DraftKings.
DraftKings, a US betting and fantasy sports company, are the latest in a line of US companies looking to acquire UK-based gambling businesses and vice versa after the legalization of sports betting in the United States. Although the US supreme court passed this law in 2018, betting organisations are still required to have a US partner for operations in the country and with the after-effects of the pandemic pushing a lot of focus to online gambling services, there is a lot of movement happening in the industry.
DraftKings Interested in Entain’s Online Gambling Brands
Entain has over 3000 betting shops, but it’s easy to see that the interest isn’t in these accustomed ways, but rather the array of established online gambling brands such as; Party Poker, Bwin and Sportingbet as the online gambling market continues to surge. DraftKing’s interest in Entain could fuel the fire further and they would do well to entice MGM back in to create a bidding war between the two gambling companies. This all points to proving Entain’s valuation statements correct, while also showing more evidence that the UK’s gambling technology continues to sharpen in the aftermath of the pandemic. Would Entain even consider selling up anyway? The company has made strong strides in the US and with an end of the pandemic in sight, growth should increase further.
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