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Entain Wants to Acquire Enlabs for €276.4 Million
January 12, 2021 Alex Hoffmann
Although it received a purchase proposal worth $11 billion from MGM Resorts at the start of 2021, Entain is now interested in expanding the network of the world’s largest gaming groups by putting an offer worth €276.4 million to acquire Enlabs.
According to details, the British sports betting and gambling company with headquarters in Isle of Man would pay SEK40 for each Enlabs share, which has been recommended by the Enlabs board. The shareholders holding 42.2% of total Enlabs stocks have also accepted the offer.
Focusing on Growth in New Regulated Markets
Formerly GVC Holdings, now Entain PLC, owner of Bwin, Coral, Ladbrokes, PartyPoker and Sportingbet explained that the acquisition of Enlabs, a Sweden-based company with innovative approach to iGaming, is directly aligned with the company’s growth strategy. Entering new local regulated markets is the primary objective for the group in 2021, whose products are already live in more than 20 countries.
Entain, whose board of directors rejected MGM’s $11bn takeover offer, said that it would retain the services of current Enlabs board chairman Niklas Braathen, as his expertise is vital for developing the group’s operations in the region and its expansion into new online gaming sectors.
The company has recently signed a partnership with Yggdrasil and Playtech, but it also acquired a majority stake in Shogun Group, a Malta-based operator.
The transaction is expected to complete before the end of the first quarter in 2021. Shay Segev, chief executive of Entain, said about the acquisition:
“The acquisition of Enlabs is perfectly aligned with our strategy of expanding across new regulated international markets. We are hugely excited by the growth opportunities it presents both in its existing markets and through new market opportunities.”
Segev added:
“Enlabs is already a strong and rapidly growing business in its own right, but we now have a fantastic opportunity to turbocharge its growth by leveraging the power of our unparalleled proprietary technology, scale, product and marketing expertise.”
Niklas Braathen, the board chairman at Enlabs, also commented:
“When Entain’s interest to acquire Enlabs emerged, we instantly saw the strategic logic. Entain’s experience and track record in many different geographic markets, together with its market-leading proprietary technology and world-class marketing skills are key attractions for Enlabs as we look to grow in the Baltics and beyond.”
Increased Stake in Global Gaming
Earlier in November 2020, Enlabs increased its stake in Global Gaming, a Swedish company that provides an array of iGaming products on the international market, including video slots, progressive jackpots, table games, poker, scratch cards and live dealer rooms.
The ownership has grown from 66.7% to 95.8% whereby Enlabs now holds a total of 39,141,725 shares. On another note, the company does not possess any financial instruments for commercial exposure, but the board intends to eventually acquire the remaining outstanding shares in Global Gaming and promote a delisting of stocks from Nasdaq First North Growth Market Stockholm.
The official reason behind Entain’s rejection of MGM’s $11 billion offer is “undervalue”, since the UK company experienced positive results in 2020 and still reports a steady online betting surge.
Source:
“Entain Puts Forward €276.4M Offer to Acquire Enlabs”, europeangaming.eu, January 11, 2021.
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It is unbelievable to hear that someone would refuse $11bn dollars but then again it takes decades to build a business in this industry and stay at the top. Enlabs is a good investment and its new potential owner will probably rise in value again.