Zona de Azar USA – MGM Resorts Shareholder IAC Willing to Support Entain Takeover
USA.- January 11th 2021 www.zonadeazar.com IAC/InterActiveCorp, the US media giant that holds a 12% stake in MGM Resorts International, has indicated it would be willing to significantly increase its stake in the global gaming giant should it follow through with a bid to acquire British online betting firm Entain PLC.
As reported by Inside Asian Gaming last week, MGM Resorts has proposed an offer that could see it acquire Entain by way of a stock offer in a deal worth more than US$12.9 billion.
While Entain – already MGM’s joint venture partner in the US online gaming market via the BetMGM brand – has knocked back an initial offer, MGM revealed Friday that it has now received the official backing of one of its major shareholders to continue pursuing the deal.
According to MGM, IAC – which acquired a 12% interest in MGM last August via a series of transactions totaling well over US$1 billion – has sent a non-binding letter of intent supporting the move and indicating that it would be be willing to consider funding a portion of a partial cash alternative should such an option be made available to Entain shareholders.
This would be made “through a further investment in MGM due to IAC’s confidence in MGM and its prospects,” MGM said.
“IAC further indicated in its non-binding letter of intent that it is IAC’s current intention that IAC’s additional investment into MGM for these purposes could be up to US$1 billion. The terms and amount of such investment would require the mutual agreement of IAC and MGM.
“IAC has to date invested approximately US$1 billion in MGM with an initial investment thesis of accelerating MGM’s penetration of the $450 billion global gaming market. IAC notes in its letter of intent that IAC continues to strongly support this objective for MGM whether or not a transaction with Entain is consummated.”
IAC has apparently stated its belief that acquiring Entain would position MGM as a “pure play omni-channel global leader in gaming and entertainment,” allowing it to accelerate the growth and market penetration of BetMGM.
IAC also outlined its belief that maximising the value of BetMGM would “allow the combined business to aggressively pursue its growth objectives such as US online market penetration, new development in key international gaming markets, future M&A and returning capital to shareholders.”
Edited by: @MaiaDigital www.zonadeazar.com
