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Does the house always win? MGM Resorts bets big on Entain for $11bnINTL

Does the house always win? MGM Resorts bets big on Entain for $11bn

Ladbrokes owner Entain, who used to go by the name of GVC Holdings, received an $11 billion takeover offer from U.S. casino giant MGM Resorts. The British gaming company, which also owns a series of online sports betting and gambling sites, in addition to the popular High Street betting shops, confirmed the offer but was quick to rebuff it as it “significantly undervalues the company and its prospects.” Way to play hardball!

This isn’t the first time Entain claims it is being offered a low price, as it had already refused an all-cash $10 billion bid from MGM. This MGM takeover bid is simply the latest in a series of attempts by casino operators to move into the online gambling business. With many physical locations closed across both sides of the Atlantic, it makes sense that casino giants are desperate to get a piece of booming online gambling businesses. Virtual poker game, anyone?

why it matters
After news of the offer broke, Entain’s share price spiked by more than 25% to £14.30 per share, which is a sign that investors expect yet another higher bid by MGM to take place. This stands particularly after its rival, Caesars Entertainment, bought UK-based William Hill last year, proving the two are making swift moves to take advantage of the sports betting market in the U.S., which was recently legalized.