DraftKings drops bid to acquire Entain26th October 2021 1:12 pm GMT
New York-listed betting and gaming operator DraftKings will not pursue its bid to acquire Entain.
The companies had been in talks since September, when DraftKings proposed to acquire Entain for more than $20bn.
The proposed acquisition immediately sparked concern among executives at MGM Resorts International, which operates the successful BetMGM online brand in the United States through a joint venture with Entain.
That joint venture was too lucrative to jeopardise, prompting Entain last week to ask DraftKings for clarity on the terms of any proposed technology supply agreement to BetMGM and MGM, as well as governance rights over the JV.
As a result of the ongoing discussions, DraftKings’ deadline to announce whether it would make a formal offer for Entain was extended until November 16. However, DraftKings said Tuesday (Oct. 26) that it will not be making a formal offer.
“After several discussions with Entain leadership, DraftKings has decided that it will not make a firm offer for Entain at this time,” said Jason Robins, DraftKings CEO and co-founder.
“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.”
Shares in Entain plc. (LSE:ENT) were trading 8.52 per cent lower on the news at 1,955.00 pence per share in London Tuesday afternoon, while shares in DraftKings Inc. (NSQ:DKNG) were up 8.44 per cent in New York pre-market at $50.77 per share.