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Multinational sports betting and gambling company Entain has put in a $3.5 billion bid to acquire the wagering and media business of Tabcorp (ASX: TAH) today.
However, there is no certainty that the proposed deal will go ahead, as the Tabcorp board has not yet formed a view on the bid from Entain which owns brands such as bwin, Coral, Ladbrokes, PartyPoker and Sportingbet.
Further, the unsolicited, non-binding proposal from London Stock Exchange-listed Entain remains subject to a number of conditions including due diligence, arranging financing, receipt of all regulatory approvals, and obtaining various third party approvals and consents.
The bid comes a month after Tabcorp decided to undertake a strategic review to assess and evaluate its structure and ownership options to maximise value for shareholders.
That review came in response to the company receiving "several" unsolicited approaches to acquire the wagering and media business for around $3 billion - an undervaluation of the business according to Tabcorp.
"The Tabcorp board has not yet formed a view on the merits of the revised proposal and will assess it in the context of the previously announced strategic review," says Tabcorp.
"As stated, the objective of the strategic view is to assess and evaluate all structural ownership options and to maximise the value of Tabcorp's business for the benefit of shareholders.
"These options may include a potential sale of the wagering & media business to a third party or 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.
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