Time is running out for DraftKings, who face an October 19th deadline to submit a formal offer for Entain, the UK-based gaming powerhouse. This potential acquisition, estimated at over $22 billion, could spark intense competition for the company.
Entain, the parent company of renowned wagering brands such as Ladbrokes Coral and bwin, experienced a surge in its share price to unprecedented levels in late September following speculation of a $20 billion proposal from DraftKings. Although the initial fervor has subsided somewhat, Entain’s shares received another boost when MGM Resorts CEO Bill Hornbuckle hinted at a possible takeover.
MGM and Entain are already collaborators in BetMGM, a prominent sports wagering platform. The trajectory of this alliance is now unclear, leaving many to ponder the fate of BetMGM should DraftKings’ pursuit of Entain prove successful.
JPMorgan analysts suggest that DraftKings may need to cede Entain’s portion of BetMGM to circumvent obstacles from MGM Resorts, which appears resolute in retaining authority over the profitable sports betting enterprise.
Hornbuckle himself has emphasized his unwillingness to entertain any agreement that diminishes MGM’s influence over BetMGM. “There are avenues for structuring it,” he remarked, “However, ultimately, we must retain control. We require adaptable technology.”
This is not the first instance of Entain attracting potential buyers. Earlier this year, they declined an $11 billion bid from MGM, leading the latter to withdraw from discussions.
From the beginning of 2023, Entain has maintained significant momentum, acquiring businesses such as Unikrn and experiencing a surge in their share value. Any entity considering an acquisition will probably need substantial resources – their recent achievements have positioned them as a high-value acquisition prospect.
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