Mixi has won the takeover battle for Australian online gaming operator PointsBet, which pointed out several issues with Betr Entertainment’s bid.
Betr, formerly BlueBet, had looked to be in pole position for the takeover with a second offer, had subsequently entered due diligence talks with PointsBet.
While those talks were ongoing, Mixi improved its offer – and PointsBet board has now formally ceased talks with Betr and is unanimously recommending shareholders accept Mixi’s offer.
Mixi, a Japanese company that has an Australian gaming subsidiary and wants to strengthen there, has offered to acquire 100 per cent of PointsBet’s shares through a scheme of arrangement for AU$1.20 per share.
Should that offer fail to go through, Mixi and PointsBet have agreed to a Bid Implementation Deed through which Mixi will make an off-market takeover bid for the same price per share.
PointsBet said the value of the Betr proposal is “materially below” that of Mixi’s offer. It tracked the overall value of Betr’s offer and found that it varied from between $1.04 per share and $1.14 – but has never exceeded the $1.20 offered by Mixi.
PointsBet added that the value of the cost synergies identified by Betr “has been materially overstated, having regard to PointsBet’s view of the brand and digital investment required to sustain growth and retain customers, and the levels of product and technology investment required to sustain a ‘number four’ market position (especially in the higher growth ‘sports’ category, where PointsBet is currently much stronger than Betr).”
PointsBet said the revenue dis-synergies would also reduce the net synergies, as a result of high levels of customer crossover between PointsBet and Betr and expected customer behaviour.
There are “significant integration and implementation challenges, with Betr assuming that PointsBet’s Canadian business can be carved out and large synergies realised concurrently (which will likely further reduce the achievability of synergies),” PointsBet said.
