Home Business-newBusiness Entain Rejects MGM Resorts Offer in the End

Entain Rejects MGM Resorts Offer in the End

by Yucatan Times
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A global player in the UK’s gambling market, Entain (formerly known as GVC Holdings) has rejected a cornerstone bid from MGM Resorts International for just over $11 billion. The Entain Group have stated that they rejected the offer because the offer from MGM undervalues their group.

Who Are Entain and MGM Resorts?
Entain (ENT) is a retail betting and online casino group trading on the London Stock Exchange. The group currently holds just over 20 licenses to provide gambling services in other countries.

It is one of the most prominent global players in the gambling industry. It includes leading Canadian online casino brand PartyCasino and some of the most recognised bookmakers in the UK, such as Ladbrokes, BWin, Foxy Bingo and Coral.

The group has moved its domicile around over its existence, first entering the market from Luxemburg then moving to the Isle of Man in 2010 for taxation advantages and now in the United Kingdom.

On the other hand, MGM Resorts is the largest casino operator on the Las Vegas strip and host other entertainment and hospitality venues across the USA, including New Jersey, Detroit, and Maryland. They also have operations in Macau, the Las Vegas of Asia. The businesses are exceptionally successful and also one of the most recognised groups in the worldwide gambling sphere.

What Was the MGM Resorts’ Bid?
The news broke that MGM was going to make a bid to buy the company by The Wall Street Journal and their direct sources. It is believed that Entain had already rejected a bid from MGM for around $10 billion. This bid and any future bids from MGM have been backed by the group’s largest shareholder, Inter Active Corp (IAC).

The second bid came in at $11.1 billion, which was also rejected because Entain feels the proposal undervalues the company. After news broke that the second bid had been rejected, Entain’s shares catapulted almost 27%, while MGM shares were somewhat down.

Consequential to the second bid rejection, Entain has informed its shareholders not to take action.

Why Does MGM Want to Buy Entain?
MGM sees the acquisition as a way to help them diversify away from land-based casinos and entertainment, especially after all MGM casinos had to close in 2020. Entain is one of the leaders in online gaming services, and acquiring the company could pave the way into this constantly growing market.

It should also be noted that the two groups have gotten into bed with one another already. They have a 50-50 joint venture partnership of BetMGM, an online betting and iGaming platform.

Will MGM Resorts Make a Third Bid?
There is some speculation that MGM is still at the table and are willing to make a third bid. There is also an indication that Entain would like negotiations to proceed rather than collapse.

After the second bid was rejected, Entain asked MGM to provide them with “additional information” regarding the rationale for combining the two outfits.

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