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betr Entertainment Tenders Superior All-Scrip Takeover Bid For Pointsbet

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By Imelda Cotton - 
betr Entertainment ASX BBT PBH Superior All-Scrip Takeover Bid Pointsbet
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Digital wagering operator betr Entertainment (ASX: BBT) has made an all-scrip off-market takeover offer for the remaining equity in PointsBet Holdings (ASX: PBH).

The company is currently PointsBet’s largest shareholder with a 19.6% interest and believes its offer represents a superior proposal to an earlier bid made by Japanese digital media and entertainment company MIXI Inc and MIXI Australia.

betr’s offer gives PointsBet shareholders an opportunity to participate in the “compelling growth potential and value enhancement” of two complementary wagering brands, including $44.9 million of expected annual cost synergies worth approximately $0.67 per PointsBet share if realised in full.

Bid Consideration

betr’s consideration of 3.81 of its shares for every one PointsBet share equates to $1.22 per PointsBet share (based on a betr share price of $0.32), marginally higher than MIXI’s offer of $1.20 cash per PointsBet share.

Assuming the synergies are realised and capitalised at a 10x multiple, the potential market cap of the combined business could be more than $1 billion, positioning the entity as a leader in the Australian wagering marketplace.

betr will fund the acquisition from proceeds of the $130 million capital raising it conducted in May that comprised a $69.1 million retail and institutional entitlement offer and a $60.9 million institutional placement.

Track Record

betr executive chair Matthew Tripp said his team had a track record of accurately quantifying and rapidly realising cost synergies through acquisitions.

“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,” he said.

“I am confident the combination of PointsBet and betr will create a profitable and valuable business in this attractive sector.”

Value Enhancements

betr believes its proposed takeover will result in significant value enhancements for all shareholders.

“PointsBet shareholders will benefit from additional longer-term value upside and a potential re-rating from the betr management team’s unparalleled track record of success, and the advantages of scale in a fast-consolidating market,” Mr Tripp said.

At completion of the transaction, the combined entity will have increased institutional investment appeal and a potential pathway for inclusion on the S&P/ASX 300 index.

The board of PointsBet has advised shareholders to take no action in response to the takeover proposal.