26th Oct 2021 13:23
(Alliance News) - Shares in Entain PLC dropped on Tuesday afternoon after US suitor, DraftKings Inc, decided against making a firm offer to acquire the FTSE 100 betting company.
DraftKings Chief Executive Jason Robins said: "After several discussions with Entain leadership, DraftKings has decided that it will not make a firm offer for Entain at this time."
The Boston, Massachusetts-based sports betting firm in September tentatively proposed to acquire Entain for 2,800 pence per Entain share, consisting of 630p in cash and the balance payable in new DraftKings Class A common shares.
Entain shares sank 7.8% to 1,970.50p each on Tuesday afternoon in London, with a low of 1,886.00p, having hit a high of 2,377.00p each the day after the potential merger was announced. The Ladbrokes owner is still up 74% since the year began.
"Based on our vertically integrated technology stack, best-in-class product and technology capabilities and leading brand, we are highly confident in our ability to maintain a leadership position and achieve our long-term growth plans in the rapidly growing North America market," DraftKings' Robins said.
DraftKings shares were up 7.7% in pre-market trade in New York to USD50.41 each.
DraftKings had until November 16 to make a firm offer.
It is not the first time Entain has received interest from the US. The company buffed a takeover tilt from casino operator and US partner MGM Resorts International.
The proposed takeover offer was 0.6 of an MGM share for each Entain share, which, based on closing prices on December 31, represented a value of 1,383 pence per Entain share. However, the FTSE 100-listed firm told MGM Resorts that the bid "significantly undervalues the company and its prospects".
By Greg Roxburgh; [email protected]
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