A shitty offer
In what would be a combination of gambling giants, MGM Resorts International announced this week that it has offered to buy online betting company LeoVegas AB for $ 607 million. The total comes from a purchase price of SEK 61.00 per share for LeoVegas, based in Sweden, which would be paid with MGM cash.
The offer represents a 44% premium over the closing price of LeoVegas shares on Friday.
“Our vision is to be the world’s largest gaming entertainment company, and this strategic opportunity with LeoVegas will allow us to continue to grow our reach around the world,” said Bill Hornbuckle, CEO and President of MGM Resorts. in a press release. “We have achieved remarkable success with BetMGM in the US, and with the acquisition of LeoVegas in Europe we will expand our online gaming presence worldwide. We believe this offering creates an attractive opportunity that enables the combined teams of MGM Resorts and LeoVegas accelerate our global growth in digital gaming and realize the full potential of our omnichannel strategy. “
LeoVegas is one of the leading online betting sites in Europe, licensed in eight jurisdictions. In the twelve months ended March 21, 2022, the company had € 393 million in revenue and € 48 million in adjusted EBITDA. Headquartered in Stockholm, LeoVegas also has offices in Milan, Malta and the United Kingdom.
As Hornbuckle said, this move is a way for MGM to get an important place in Europe and do it quickly. BetMGM is a 50/50 joint venture between MGM Resorts International and Entain, which owns partypoker, among other brands. BetMGM has quickly become a major player in the U.S. online gambling market, especially sports betting, where it faces competitors such as FanDuel, DraftKings and Caesars.
BetMGM Poker / partypoker is currently in three states: New Jersey, Michigan and Pennsylvania. It ranks second in both New Jersey and Michigan in terms of cash game traffic (at WSOP / 888 in the first, at PokerStars in the second) and third behind PokerStars and WSOP in Pennsylvania.
And while the United States is clearly a major market, the rest of the world is still there. This is where LeoVegas comes in. Its main markets are the United Kingdom and Scandinavia, although it also has a presence in Chile and Peru.
The company won the “Online Casino of the Year” at the 2022 Global Gaming Awards for the fifth time in a row and won the “Mobile Casino Product of the Year” at the 2021 EGR Operator Awards.
The LeoVegas Board of Directors has recommended that shareholders accept MGM’s offer. The acceptance period begins “around” June and will last until August. If the offer is accepted, MGM Resorts International expects settlement to begin in September.