Entain confirms it is considering takeover proposal from DraftKings

DraftKings has made an offer to acquire Entain for $20bn, according to reports.

Entain confirmed that it had received a proposal from sports betting and fantasy sports operator which would include a combination of DraftKings stock and cash.

Sports betting and gaming operator Entain said there was no certainty that any final offer will be made and didn’t confirm the terms to the proposal.

According to CNBC, the cash-and-stock offer is roughly 2,500 pence per Entain share, and comes several months after Entain turned down an $11bn bid from MGM Resorts International in January which it said undervalued the company.

The acquisition would position DraftKings among the global leaders in the sports betting and gaming industry. The company went public when it acquired SBTech through special purpose acquisition company (SPAC) Diamond Eagle Acquisition Corp last April in a combination worth $3.3bn.

Then in August, it was announced that DraftKings is to acquire Golden Nugget Online Gaming (GNOG) in an all-stock purchase with an equity value of $1.56bn.The operatorwill use the Golden Nugget brand, online product experience and a database of more than five million users.

The potential deal would follow in the footsteps of Caesars Entertainment acquiring William Hill for £2.9bn ($3.96bn) in April to boost Caesars’ footprint in the US.

Entain also mentioned that a further announcement will be made when appropriate. Any potential offer will be governed by the City Code on Takeovers and Mergers and DraftKings have until 5pm on 19 October to announce a firm offer or its intention not to go forward with the acquisition.

As a result of the announcement, shares in Entain surged 22% to 2,268 pence on Tuesday 21 September.

Image source: DraftKings website – media kit