Sydney-listed betr Entertainment has announced an all-scrip off-market takeover offer for all of the shares in PointsBet Holdings that it does not already own.

PointsBet shareholders who accept the offer will be entitled to receive 3.81 betr shares for every PointsBet share, equivalent to A$1.22 per PointsBet share, based on a $0.32 betr share price when the company raised A$130 million in May to fund the proposed acquisition.

As PointsBet’s largest shareholder with a 19.6 per cent holding, betr believes the offer represents a superior proposal for shareholders compared to MIXI Australia’s off-market takeover offer of A$1.20 cash per PointsBet share.

betr also believes that the offer provides PointsBet shareholders with the opportunity to participate in the “significant value creation” available to the combined business, including A$44.9 million of expected annual cost synergies.

“This is just the start of the value creation journey we envisage for betr and PointsBet Shareholders for the combined business,” said betr in a statement. “Significantly, in addition to this, PointsBet Shareholders can benefit from the additional longer term value upside and potential re-rating from the betr management team’s unparalleled track record of success, and the advantages of scale in a fast-consolidating market, as Australia’s only ASX-listed pure-play digital wagering operator, with increased institutional investment appeal and a potential pathway for S&P/ASX 300 index inclusion.”

The offer is subject to several conditions, including betr shareholder approval, and is expected to open on 31 July and close on 8 September.

“The combination of complementary wagering brands, like PointsBet and betr, is a model our team has deployed many times over the past 25 years with great success,” said betr executive chairman Matthew Tripp in a letter to PointsBet’s shareholders. “We are the team behind the acquisition, scaling and sale of some of the biggest brands in this country, including Sportsbet, Sportingbet, BetEasy and CrownBet. 

“I am confident that the combination of PointsBet and betr will create a profitable and valuable business in this attractive sector. I am also confident that the combination will ultimately create enhanced shareholder value for all PointsBet Shareholders, of which betr is the largest, with our company holding 19.6 per cent of all PointsBet Shares.”

betr intends to assess opportunities to increase its offer, and will continue to update the market as required by the ASX Listing Rules and Corporations Act.

MIXI’s off-market takeover bid of A$1.20 per PointsBet share remains subject to conditions that include acceptance by shareholders representing at least 50.1 per cent of PointsBet, as well as regulatory approvals in Australia and Canada, which was secured last week.

Shares in betr Entertainment Ltd (ASX:BET) closed 3.85 per cent higher at A$0.27 per share in Sydney earlier Wednesday, while shares in PointsBet Holdings Ltd (ASX:PBH) closed unchanged at A$1.19 per share. 

Shares in MIXI Australia parent MIXI Inc. (TYO:2121) also closed unchanged at ¥3,500.00 per share in Tokyo earlier Wednesday.