The local boss of UK wagering giant Entain has warned Tabcorp that a standalone TAB business could be worth far less than the cash offers on the table by the time a demerger is completed.
The $11 billion Tabcorp is weighing up three offers for its betting business – cash bids of $3.5 billion from Entain and private equity group Apollo, and a $4 billion cash-and-scrip offer revealed on Friday from the Matthew Tripp-backed betting technology group BetMakers – against the option of splitting its betting and lotteries division into two separate ASX-listed companies.
Speaking publicly about its bid for the first time on Monday, Entain Australia’s chief executive Dean Shannon said Tabcorp should accept its $3.5 billion bid for the TAB bookmaking and media business or risk losing more ground to online competitors if it opts for a demerger.Speaking publicly about its bid for the first time on Monday, Entain Australia’s chief executive Dean Shannon said Tabcorp should accept its $3.5 billion bid for the TAB bookmaking and media business or risk losing more ground to online competitors if it opts for a demerger.
“That’s going to take some time to play out, Tabcorp is losing market share – what’s it going to be worth by the time we get to a demerger?” said Mr Shannon, who runs the Ladbrokes and Neds betting brands locally.
“Our offer gives Tabcorp shareholders certainly. We’re in this position where we could possibly buy Tabcorp wagering and media because the shareholders are sick of listening to promises and not having them delivered.”
Several major investors and analysts believe a demerger is the most likely outcome because state racing bodies – and in Entain’s case the competition regulator – will need to sign off on a sale to another party.
But Mr Shannon said he was confident a sale could be finalised just as quickly as a spin-off, in less than 12 months. He said the £9.7 billion ($17.8 billion) London-listed Entain was best placed to invest in the local racing industry, which gets the bulk of its funding through partnerships with TAB.
“They all know how supportive I’ve been of racing for the last eight or nine years,” he said
Source: The Sydney Morning
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