The potential for prominent US sports betting operator DraftKings to purchase FTSE100 international gambling group Entain was perhaps the most talked about news story of the month in the betting and gaming industry.
Although the potential $22 billion buyout was ultimately unsuccessful, for the hosts of the Legal Sports Report, the story is far from over.
Ultimately, one of the major hurdles to the merger was the status of BetMGM, the US-facing sports betting subsidiary jointly-managed by Entain and MGM Resorts.
Under the terms of the deal between the two companies, a new owner of Entain would require the permission of MGM to operate the brand.
Sharing his views, LSR writer Matthew Waters observed that Entain has ‘the upper hand right now’ with regards to any future agreements.
“They sure do have the upper hand right now. MGM came in and was offered about $10 billion for them a few months back, and now $22 billion has been rebuffed, so it’s pretty expensive. idea just to get involved with this at all,” he remarked.
“MGM at the corporate level is doing a whole lot of stuff. They’re trying to go asset-light and they’re paying down debt. There’s just a lot of moving parts behind it right now, but it’s definitely not the end of the story for sure.”
Dustin Gouker, meanwhile, noted that despite the deal falling through, any ‘chatter’ surrounding a potential merger ‘is not going away’.
He commented: “BetMGM or MGM Resorts seeing this wants to stop any kind of speculation, I would imagine, about its future – so what do they do in terms of their deal? With Entain they made it offer a ways back, do they revisit this deal?”
“DraftKings can’t even come back and make an offer now for six months under the deal that is happening, so we’ll see. This is certainly not the end of chatter about this, but as time goes on, the price tag for Entain probably only goes up, so you’ve got to think that people are going to be talking about this and still kicking tires, including MGM.”
Additionally, the hosts also discussed ongoing developments in the state of New York, where the situation regarding taxation is still a major talking point.