Entain has been named as a potential takeover target, according to trader reports citing a Betaville alert circulating this week – though Global Gaming Insider understands the prospect of a deal is unlikely.
MGM Resorts, which already operates the BetMGM joint venture alongside Entain on a 50-50 basis, has been identified as a possible acquirer.
Private equity firms CVC Capital and Apollo Global are also said to be exploring a potential transaction, either in partnership with MGM or independently.
Deutsche Bank is reported to be advising and potentially financing one of the prospective buyers, though no formal offer has been confirmed.
It would not be the first time Entain has attracted acquisition interest. The company turned down an all-stock bid from MGM in January 2021 and subsequently rejected a cash-and-stock offer from DraftKings in September of the same year.
That track record, combined with the speculative nature of the current reports, leads us to treat the latest speculation with some scepticism.
Indeed, there may be a more prosaic explanation for why the rumour mill is turning. Earlier this week, Non-Executive Director Ricky Sandler stepped down from the Entain board as he winds down his hedge fund, Eminence Capital – previously Entain's third-largest shareholder.
With a significant shareholding now needing to be offloaded, it is plausible that speculation around a takeover is serving to talk up the share price ahead of that sale, rather than reflecting any genuine dealmaking activity.
Despite a 7% share price drop following Sandler's departure, Entain's underlying fundamentals remain reasonably solid, with Q1 results in April showing 3% year-on-year revenue growth.
Global Gaming Insider contacted Entain, which had no comment on the story.
MGM Resorts previously attempted to acquire Entain in January 2021, while DraftKings also made an unsuccessful approach later that year
