Betr shares slide as it doubles down on rejected PointsBet acquisition bid
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The news: Betr’s share price is continuing to slide after the gambling business reaffirmed its commitment to an acquisition proposal that was rejected by rival PointsBet.
The numbers: Shares in Betr had fallen 4.5% to $0.28 at 11:50am AEST whereas PointsBet shares had slipped 0.4% to $1.18.
The context: PointsBet’s board announced it had rejected Betr’s proposal, which planned to purchase its shares for $1.33 each, in favour of continuing with an ongoing deal with Japanese entertainment giant MIXI.
While the MIXI deal only values PointsBet shares at $1.20 each - increased from an initial $1.03 - the board considers Betr’s claimed cost synergies to be “materially overstated”, according to a statement issued on Monday, and that integration would come at significant cost.
This characterisation was “categorically” rejected by Betr chief executive Andrew Menz in a response released to the exchange on Tuesday morning.
Before PointsBet shareholders vote on the MIXI deal on Wednesday next week, Betr intends to provide PointsBet with confirmation from a “Big Four accounting adviser of Betr’s synergy pool, in excess of $40 million”.
Betr is PointsBet’s largest shareholder, holding a 19.9% interest, and intends to vote against the MIXI deal. Betr also claimed that it is aware of “several PointsBet shareholders” that are supportive of its proposed deal and thinks it is “likely that the MIXI proposal will fail”.
A takeover proposal issued by Betr in February was also rejected in favour of the MIXI deal.
The source: ASX
