It was less than two years ago when MGM resorts made an unsuccessful takeover bid for the BetMGM sportsbook. The $11.06 billion offer was rejected by their co-venturer – Entain, who felt that the offer undervalued their company.
However, the recent performance of BetMGM could spark another try for the popular US casino operator in acquiring BetMGM 100%.
According to the reports from Entain PLC, BetMGM had a terrific performance in the 2022 3rd Quarter as its net gaming revenue jumps by $400 million. for a 90% increase compared to the previous quarter.
While this may be a result of the comeback of the football season, BetMGM’s dominance in the US gambling industry is undeniably recognizable as it accounts for 23% market share in the states that it is available.
In addition, BetMGM revealed that it is the largest operator among the regulated US online casinos and holds the second spot in terms of sports betting.
BetMGM’s success can be attributed to several factors, including its innovative approach to online gambling, its user-friendly website and mobile app, and its generous bonuses and promotions. BetMGM has also benefited from the popularity of online gambling in general, as more and more people are turning to the internet to place their bets.
With its convenient online platform and its competitive bonuses and promotions, BetMGM is well-positioned to continue its success in the online gambling industry.
While BetMGM is described as the “crown jewel” for MGM resorts as per Will Hershey (RoundHill Investments co-founder), having full control over it is easier said than done. The British gaming company is looking for a higher amount for its 50% share in BetMGM and acquiring additional funds may be challenging.
Even though the largest shareholder of MGM Resorts, Barry Diller’s IAC/InterActiveCorp, may possibly provide support for the acquisition, more funds will be required to match Entain’s expectations.
These funds may be acquired from creditors but it seems like they are unlikely to support the transaction as the real money gaming industry is not in a favorable position. Hersey also added that this is not the right time to initiate large-scale mergers and acquisitions.
With all the challenges involved, MGM may be leaning towards taking their time before initiating the call for takeover.
