Entain extends DraftKings deadline but warns of definitive deal duties
Entain Plc has extended its ‘put-up or shut-up’ deadline to DraftKings, as investors of the FTSE100 gambling group demand that its US suitor put definitive terms on its $20 billion acquisition bid.
In an official announcement this afternoon, the gambling group detailed that it requires ‘a number of matters to be satisfactorily resolved ‘by no later than 5.00pm on 19 October 2021’, although it also confirmed that negotiations with DraftKings ‘remain ongoing’.
Matters, which Entain has described as ‘fundamental’ to the value of the proposal, include total value creation for Entain shareholders – including synergy shares – governance and management composition of the prospective combined entity and deliverability of such a transaction, including anti-trust and regulatory clearances.
The status of BetMGM, which Entain operates as a US-facing subsidiary in collaboration with MGM Resorts, has also been cited as an issue requiring further clarification.
Entain cited the governance rights and value protection for the combined entity’s stake in BetMGM as needing greater assurances, in addition to the terms of any proposed technology support agreement to both BetMGM and MGM.
The group maintains that pursuing leadership via BetMGM in the North American sports betting market continues remain a commercial objective as one of the opportunities laid out at its capital markets event on 12 August,
Irrespective of DraftKings approach, Entain governance remains focused on executing its corporate strategy presented to investors on 12 August that aims to treble the businesses addressable market size to $160 billion.
Entain’s update read: “The Board strongly believes in the future prospects of Entain, underpinned by its leading market positions, world class management team and industry-leading proprietary technology.
“Entain has an outstanding track record of growth having delivered 23 consecutive quarters of double digit online NGR growth, and a 3 year CAGR of 19% across 2021.”