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US alternative asset management firm Apollo Management has taken a punt on Tabcorp (ASX: TAH) today and placed two different bids to acquire the gambling company's wagering and media busines.
Apollo is proposing two different paths to acquisition: $4 billion for Tabcorp's wagering & media business and its gaming services business or alternatively, $3.5 billion for the wagering & media business alone.
The latter option matches a proposal from multinational sports betting and gambling company Entain, the owner of Ladbrokes, which unveiled its bid in late-April.
As Apollo's proposals are unsolicited they remain subject to numerous conditions, including due diligence, arranging financing, and receipt of regulatory approvals.
Tabcorp's board has also not yet formed a view on the merits of Apollo's proposals, and the board will assess them in the context of a previously announced strategic review.
"As stated, the objective of the strategic review is to assess and evaluate all structural and ownership options to maximise the value of Tabcorp's businesses for the benefit of shareholders," says Tabcorp.
"These options may include a potential sale of the wagering & media business to a third party of a potential demerger of either the wagering & media business or the lotteries & Keno business."
Tabcorp's wagering and media business reported solid underlying performance during 1H FY21, with digital revenue growing by 34 per decent.
However, COVID-19 shutdowns and restrictions, especially in Victoria, contributed to retail turnover declining by 28 per cent.
Shares in TAH are up 2.40 per cent to $5.13 per share at 10.09am AEST.
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