DraftKings Weaker on Worries It’s Paying Too Much for U.K.’s Entain
By Dhirendra Tripathi
Investing.com – DraftKings stock (NASDAQ:DKNG) traded 0.8% lower in Wednesday’s premarket on worries that its pursuit of U.K.-based Entain (LON:ENT) will prove bad value for shareholders.
The stock had closed 7.4% lower Tuesday after Entain rejected its first offer as too low. DraftKings sweetened the offer on Sunday.
DraftKings has now offered 2,800 pence per Entain share consisting of 630 pence in cash and the balance payable in new DraftKings shares. The latest offer is a premium of 46.2% to Entain's closing share price on September 20 and amounts to over 16 billion pounds ($22 billion) more than four times the company’s 2020 revenue.
Entain said it is studying the latest offer and that DraftKings must announce a firm intention to buy not later than 5 PM on October 19 or say it does not intend to do so.
It said the deadline will only be extended with the consent of the U.K.’s Takeover Panel.
Entain is one of the world’s largest sports-betting and gaming groups, operating both online and in the retail sector. It has licenses in 27 countries and employs a workforce of more than 24,000.
In the U.S., the Group operates BetMGM, a joint-venture with MGM Resorts (NYSE:MGM).
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DraftKings Weaker on Worries It’s Paying Too Much for U.K.’s Entain
