US Sports Betting Update: DraftKings Abandons Bid for BetMGM Co-Owner Entain

Matthew Haynes •

US Sports Betting Update: DraftKings Abandons Bid for BetMGM Co-Owner Entain

DraftKings has abandoned an ambitious $22.4 billion attempt to purchase UK gaming giant Entain. The Boston-based company initially offered Entain £25 per share in a cash-and-stock deal submitted towards the end of September. That initial bid was rebuffed, so DraftKings returned with a £28 per share offer that valued the firm at £16.2 billion ($22.4 billion).

The Entain board had been considering the bid, but both parties announced this week that talks had ended. “After several discussions with Entain leadership, DraftKings has decided that it will not make a firm offer for Entain at this time,” said chief executive, chairman and co-founder Jason Robins. “Based on our vertically-integrated technology stack, best-in-class product and technology capabilities and leading brand, we are highly confident in our ability to maintain a leadership position and achieve our long-term growth plans in the rapidly growing North America market.”

DraftKings is the second U.S. company this year to try and fail to take control of the London-listed operator. Neither company explained why the talks broke down. UK regulations mean that DraftKings cannot make another offer for Entain within the next six months, unless there is a rival bid. 

The Sports Betting Gold Rush

Entain saw its share price jump 25% after DraftKings submitted its takeover bid for the company in September. It was a bold and aggressive move from DraftKings, which is bidding to carve out a market leading slice of the burgeoning U.S. sports wagering industry. The bid valued Entain at a 46.2% premium to its closing price on the day before the offer was made public, causing the firm’s share price to spike.

Entain is a London-listed company formerly known as GVC Holdings. It owns famous brands such as Ladbrokes, Coral, Bwin, Sportingbet and PartyPoker. In the U.S., it has launched a successful 50/50 joint venture with MGM Resorts International called ROAR Digital, which operates BetMGM. Entain brings vast operational expertise to the venture, and its proprietary technology and bookmaking nous are very valuable amid the U.S. sports betting gold rush.

Earlier this year, MGM Holdings submitted an $11 billion bid for Entain. The board rejected the offer, claiming it undervalued the company. MGM was expected to return with an improved offer, but DraftKings stole a march on its rival. It offered £28 ($38) per share, comprising £6.30 ($8.64) in cash and the balance to be paid in new DraftKings Class A common shares.

On October 19, the UK merger regulator granted the companies an extension until November 16 to agree on a deal. Talks continued during the subsequent week, but they eventually broke down. Entain’s share price initially plummeted by 10% after the news broke, but it has now pared most of those losses. DraftKings’ share price initially increased, but it has now corrected, and it is up just 0.05% this week.

Could MGM Return with Another Bid?

The real winner could be MGM Resorts International, which was facing up to the prospect of its JV partner being swallowed up by an ambitious rival. It may now be encouraged to return with an improved offer of its own. The company’s share price hit a six-month high this week and it just raised $109 million by selling 11 Picasso paintings. Its Las Vegas properties are enjoying a roaring trade, and it is flush with $5.6b in cash and $11b in post transaction liquidity after the sale of its MGP REIT.

Entain remains an attractive takeover target for U.S. gaming heavyweights. The firm saw net revenue increase 4% in the three months to September, while online sports betting revenue shot up by 12%. Its Q3 trading update revealed that the BetMGM brand increased its U.S. online gaming market share to 32% in that period, up from 30% the previous quarter. It has a large UK retail estate, and its online brands are operational in 27 countries.

Analysts at Peel Hunt called the joint venture “a roaring success” in a client note. “The BetMGM JV is making a credible push for market leadership,” it added. “This could be the perfect time for Entain to sell out of the BetMGM JV if MGM can be pushed to overpay.”

Nevada Sets New Monthly Record

Nevada sportsbooks took a record $786.5 million in wagers during September. It smashed the Silver State’s previous monthly record of $659.4 million, which was set back in October 2020. The handle represented an 84% increase on the $427.4 million taken in August, and it was also up 36.7% year-on-year, according to the state report.

The sportsbooks held 6.9% of the wagers they handled, resulting in revenue of $54.2 million for September. That did not quite rival the record of $61.8 million set in November 2020, but it was up 279% on the previous month and 64.7% on September 2020. The handle could soar higher in October, as the NBA and NHL seasons are now underway, and the World Series is also taking place.

Several states hit new all-time highs in September. Market leader New Jersey became the first state to smash through the $1 billion barrier, while Michigan took $386.8 million, Indiana managed $355.4 million, and Iowa took $20.7 million. Pennsylvania took $615.3 million in September, so Nevada currently occupies second place, although Illinois could take that spot when it eventually reveals its September figures.

Wyoming has also reported a buoyant start to its new legal sports betting industry. The state’s first legal sports betting operators – DraftKings and BetMGM – began accepting wagers on September 1, and they took $6.2 million during the month, according to the Wyoming Pari-Mutuel Commission. They held 15.4% of that revenue, which amounts to $954,416 in gross gaming revenue. However, the sportsbooks spent a lot of money on promotional credits in the battle for early market share, so they actually reported a combined loss of $124,696 for the month. FanDuel Sportsbook and Barstool Sportsbook are expected to bring increased competition to Wyoming in the months ahead.

  • William Hill Casino

    $500 Risk Free Bet

    To be eligible for this Promotion, all eligible Patrons must place their first real money sports wager via the William Hill mobile app or desktop site, within 7 days of opening a William Hill NJ Account. If their Qualifying Wager is graded as a Loss the Participant will earn a one-time Free Bet token equal to the lessor of: 1) The full value of the Qualifying Wager or 2) $500 (“Free Bet(s).
  • 888 Sport

    $500 Welcome Bonus

    Player must be at least 21 years old, located in New Jersey, has completed the full registration process with, makes a first deposit equal to or greater than $10 and may be entitled to a Welcome Bonus of 100% up to $500 on the players first deposit at
  • Unibet Sportsbook

    Play Now

    Join Unibet Sportsbook today and once you add funds, we'll insure your first cash bet - get up to $500 back if you don't hit a winner. Make your first cash bet on any event. If your first settled cash bet loses, you will receive a refund to your account equal to the amount of your losing wager (up to $500). Your first cash bet ($10 or over) will qualify. You will receive the refund within 72 hours.
  • Draft Kings Sportsbook

    Get a deposit bonus up to $500!

    Join Draft Kings today and with your first deposit of $5 or more, you will receive a free $3 ticket to play in any $3 paid contest. A user’s first deposit (min. $5) made between 5/13/20 – 8/17/20 qualifies the user to receive up to $500 in bonus funds in the form of site credits that can only be used on DraftKings. Bonus amount is equal to 20% of that deposit amount, not to exceed $500 (the user must deposit $2,500 to be eligible to receive the maximum possible bonus amount of $500).
  • FanDuel Sportsbook Review

    $500 Risk Free Bet

    New Sportsbook Customers Only NJ. Join FanDuel Sportsbook today and make your first bet. If you lose, we'll give you a refund of up to $500 in site credit (within 72h). Your first bet will qualify (If you have multiple selections on one betslip, it will be the first selection you made)
  • Bet America

    Bet $50 Get $50 [code: BET50]

    Join BetAmerica today for an exclusive Bet $50 and Get $50 using code [BET50] on your next sports bet. Register today and enjoy our Freeplay contests where you can use your sports and casino knowledge to win $1000's in prizes every week.
  • SugarHouse

    100% Up To $250 Deposit Match Bonus

    Player must create a new account, make a first deposit up to $250 to get a Deposit Match Bonus. Use code 250MATCH.
  • Caesars

    $300 Free Bet

    Make your first deposit using SPORTS300 and we will match your first sports bet up to $300! Cash bet must have minimum odds of -200. On Parlay wagers, each legs must have odds of -200 or greater.

Latest news