If there’s one word which best describes Betr’s approach to the bidding battle it has found itself embroiled in over PointsBet, its tenacious.
The company has shown no signs of giving up on its ambition to acquire PointsBet, even though the acquisition target’s board of directors have recommended a different offer to shareholders.
A AU$402m offer made by MIXI Australia, the local division of Japanese digital entertainment group MIXI, has also received regulatory approval but has run into problems securing shareholder approval.
As a result, Betr does not think that the bell has been rung yet and is coming back in with one last attempt to try and turn the bidding battle back in its favour in the twilight rounds.
Instead of targeting the company’s board of directors with the bid, Betr is trying to convince PointsBet shareholders to sell off their stock to the sum of 3.81 Betr shares per one PointsBet share.
The offer equates to $1.22 per PointsBet share, based on a $0.32 betr share price. Deal value represents around $410m for the 336,800,000 outstanding shares currently available in PointsBet.
On market v off market
Betr is a key stakeholder in PointsBet, holding 19.6% of shares in the company. Its shareholding has proven the biggest hurdle to MIXI’s takeover offer, which PointsBet has consistently encouraged its shareholders to accept.
MIXI first made an on-market offer of $353m in February which was followed by a $360m offer from Betr. MIXI then re-countered this with its $402m bid, recognised and promoted by PointsBet as the superior one.
This bid has been unable to secure the necessary number of shareholder votes of 75%, however, falling short at 70%. PointsBet had previously stated that MXI’s offer had been approved, but after Betr protested that its 19.6% shareholder votes had not been included. PointsBet acknowledged that this was the case – though the firm asserts that this was unintentional and was the result of a tech issue.
Betr is now trying to seize this as a last opportunity to become the full owner of PointsBet, in doing so taking another stride forward in its challenger ambitions in Australia. M&A has played a key part in this, with Betr originating as a joint venture between News Corp and Tekkorp Capital before merging with fellow challenger BlueBet last year.
A question to be asked though is – why are both MIXI and Betr so keen to acquire PointsBet? For the latter the answer may seem obvious, with Betr/BlueBet wanting to gain more share in its founding market and challenge the legacy brands of Tabcorp, Sportsbet, Ladbrokes Australia and Neds (of Entain Plc).
Why Australia? And why now?
Whether now is the right time to invest in Australian betting might be the bigger factor to consider, for both Betr and MIXI. Pressure has been mounting on the sector for some time and reform campaigners are keen to see changes to regulation.
The Murphy report, written and published by the late MP Peta Murphy, made a number of recommendations for changes to Australian gaming regulation including restrictions on advertising and new player protection requirements.
Though this agenda was shelved ahead of the 2025 Australian general election, with PM Anthony Albanese and his Labor government now firmly back in power there is a solid chance these changes will progress.
With this in mind, however, PointsBet’s Canadian business may be more of interest to investors. Ontario is the only regulated market and a highly competitive one at that, the prospect of other Canadian provinces like Alberta following suit might present a more lucrative prospect for PointsBet buyers.
This may well be the case for MIXI, already a multinational firm. On the other hand, the firm does already have a presence in Australian betting via Northern Territory brand BetM, and may simply be wanting to expand on this.
