Another MGM Bid for Entain Plc on its Way?

There are some deals that can be seen as real game-changers. That’s what MGM Resorts International are chasing at the moment. Their aim is to buy out Entain Plc and it will make one of the largest sportsbook and casino US operators even stronger.

Buying out Entain Plc will see them have complete control over BetMGM and another bid is on its way. January 2021 saw MGM make an initial bid of just over $11 billion but even that massive amount of money wasn’t deemed enough by Entain to make a deal. MGM responded by saying they wouldn’t be considering making a higher bid. UK law then made it impossible for MGM to make another bid for a period of six months.

Six months are now up and there are rumours of another bid being made soon. MGM haven’t made any statements on the situation but getting full control of Entain Plc would be a massive step forward for them.

Since the gambling laws in the US were changed, a growing number of sportsbooks have been launched. BetMGM has enjoyed a highly successful time as the gambling market expanded. The first quarter of this year saw them achieve a total revenue of $163 million. That figure is a massive 430% higher than they managed for the same period in 2020. The revenue achieved by BetMGM is nearly half of the total MGM figure.

If there is to be another bid, then it will need to be one that is a lot higher than $11 billion. It’s not just BetMGM that has been having a good year. Entain Plc has seen their share price rising since January.

Earlier this year, William Hill was purchased by Caesars Entertainment. They aren’t too keen on the non-US assets and are in the process of selling them. Entain Plc have been rumoured to be showing some interest in getting their hands on some of those assets.

MGM could find themselves in a similar situation. Their expertise is in the US market not in Europe and Australia. If they were to be successful in another bid for Entain Plc, then it would be interesting to see just what parts they keep and which they want to sell off.

The North American iGaming industry continues to grow. Estimates have revenue possibly reaching $42 billion this year. MGM need to look at whether to continue their expansion on home territory with more states likely to be legalizing gambling, especially sports betting in the months and years to come. A larger slice of the Entain Plc pie might be too tasty to turn down though.