Ladbrokes owner Entain rejects £8bn MGM takeover bid
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The owner of British betting company Ladbrokes has rejected an £8bn takeover approach by US casino giant MGM.
Entain, which also owns betting and gambling brands such as Coral, Bwin and Partypoker, confirmed the offer this morning but said it “significantly undervalues the company and its prospects”.
It added that it had asked MGM to provide additional information about the “strategic rationale” of a tie-up between the two companies.
Under the terms of the proposal, MGM has offered 0.6 shares for each Entain share, valuing it at just over £8bn and representing a premium of roughly 22 per cent on Entain’s share price.
Shares in Entain jumped 27 per cent following the announcement.
It comes after Entain rebuffed a $10bn all-cash offer from MGM, according to the Wall Street Journal, which first reported the takeover attempt.
The latest overture comes with financial backing from billionaire Barry Diller’s IAC group, which is MGM’s biggest shareholder.
It marks the latest effort by a casino operator to move into the online gambling business following a relaxation of US rules in 2018.
Last year Caesars Entertainment agreed a £2.9bn deal to acquire British bookmaker William Hill.
But like many of its rivals, MGM, which owns a string of major casinos including the Bellagio in Las Vegas, is also battling a sharp downturn in trading as a result of the Covid-19 pandemic.
MGM has until 5pm on 1 February to either make a firm offer or withdraw its interest.