ACCC keeps an eye on Tabcorp sales interest

by Charlotte Lee Last Updated
ACCC keeps an eye on Tabcorp sales interest

Tabcorp’s betting and media takeover has been noted by the Australian Competition and Consumer Commission.

Casino Guardian reports the ACCC is keeping an eye on the increased interest in a potential sale of part of the organisation.

The gambling giant confirmed it had received a number of unsolicited takeover offers in regards to its betting and media business in recent times.

At the time, the company confirmed receiving the bids for its non-core business, it also shared the proposals were non-binding and said they would remain confidential.

In addition, Tabcorp explained that receiving some takeover offers about the aforementioned business assets does not necessarily mean that a transaction would take place.

Now, the ACCC has emphasised that if a deal of this scale takes place, it is very likely to change the entire Australian betting sector as we know it today.

Analysts have recently estimated that the betting and media unit of Tabcorp is worth about A$3 billion.

In any case, if the Australian gambling company decides to dispose of its wagering and media business and accepts a takeover offer, the winning bidder would be required to convince the ACCC that the transaction would not only be carried out in line with the different states’ legislation, but would also bring benefits to the industry.

The company would have to receive a formal takeover offer before anything else follows.

Entain entertains Tabcorp purchase

The British owner of Ladbrokes, Entain, is reported to be in the early stages of a buyout of Australian bookmaker and gambling heavyweight Tabcorp.

Bloomberg reports that Entain made a non-bind offer for the wagering and media division of Australia’s largest gambling company.

Discussions about a combination with Entain’s existing Australian business are at an early stage, the London-listed owner of the Ladbrokes betting chain said on Tuesday.

The offer could face competition as Tabcorp said the business has received “a number of unsolicited approaches and proposals” in recent weeks.

Any deal would give Entain extra scale in the region.

Sports betting has become a busy area for mergers globally as the industry transitions online and US states legalise wagers.

Last month, Entain rejected an $11 billion takeover approach from US casino operator MGM Resorts International.

Wagering and media is Tabcorp’s biggest division after the lotteries and keno business.

In the year to June 2020, wagering and media generated 40 per cent of its A$5.22 billion in revenue, company filings show.

“Given the consolidated nature of the Australian market, there are limited such opportunities left to look at,” Goodboyd analyst David Brohan said in a note to clients.

“Assuming any deal is completed at the right price we can see positives from a transaction.”

Entain’s statement confirmed an earlier media report by an Australia newspaper which said Tabcorp had received a breakup proposal in the past two weeks.

Tabcorp shares jumped 9 per cent in trading on Tuesday, valuing the company at A$9.9 billion.

Tabcorp publicly acknowledges break up talks 

Australian wagering and entertainment company Tabcorp has confirmed it has received multiple offers to break up its business and there are reports it is under increased pressure to do so from key investors.

The Sydney Morning Herald reports that Tabcorp confirmed it had been approached about potential deals that would split its underperforming wagering business from its lucrative lotteries arm.

In response to media reports, the gambling giant published an ASX statement that said it had received “a number of unsolicited approaches and proposals” regarding its wagering and media business.

Tabcorp cautioned that the interest from multiple parties might not lead to a transaction taking place.

“The proposals were expressed to be confidential, indicative, non-binding and subject to numerous conditions including due diligence, financing and various regulatory approvals,” Tabcorp said.

“There is no certainty that any transaction will occur.

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