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American private equity behemoth Apollo Global Management Incorporated has reportedly joined the race to buy the wagering and media business of Australian bookmaker Tabcorp Holdings Limited after lodging an official bid worth in the region of $3.1 billion.
According to a Thursday report from The Sydney Morning Herald newspaper, the all-cash move comes a little over a week after British land-based and online sportsbook operator Entain made an improved $2.7 billion offer of its own for the same segments of the Melbourne-headquartered firm. This proposition is currently being considered and may well purportedly soon be followed by a second rival tender from American media conglomerate Fox Corporation in partnership with local iGaming pioneer Matthew Tripp.
Apollo Global Management Incorporated manages a portfolio of assets widely thought to be worth in the region of $335 billion and is reportedly hoping to purchase the media and wagering business of Tabcorp Holdings Limited so as to gain immediate control over an estate of roughly 4,400 land-based sportsbooks spread across the length and breadth of Australia. The New York-based suitor purportedly disclosed that its bid, unlike that from Entain, would moreover include the target’s relatively small poker machines servicing unit, which could well prove to be an attractive inducement towards getting the proposed deal over the finish line.
The Sydney Morning Herald reported that the initial $2.3 billion bid from Entain prompted Sydney-listed Tabcorp Holdings Limited to initiate a three-month strategic review that could well result in its wagering and media branch being hived off from its more lucrative lotteries business following a meticulous appraisal of its worth. The newspaper divulged that investors have become increasingly frustrated with the performance of this former unit as it continues to lose ground to local online rivals such as Ladbrokes and Sportsbet.
Reportedly read an official statement from Tabcorp Holdings Limited…
“The Tabcorp Holdings Limited board has not yet formed a view on the merits of the revised proposal and will assess it in the context of the previously announced strategic review.”
The Sydney Morning Herald earlier reported that Tabcorp Holdings Limited merged with local rival Tatts Group Limited in 2017 and currently holds about a 37% share of the Australian online and retail sportsbetting market. Any sale of its media and wagering business would purportedly be subjected to intense scrutiny from the Australian Competition and Consumer Commission and the nation’s collection of state-based licensing bodies, which get a large portion of their funding from the authorizations they issue to the operator’s Tab-branded estate of sportsbooks.
Finally, the newspaper reported that the prospect of a sale has sent the value of individual shares in Tabcorp Holdings Limited up by around 28% since January with the Apollo Global Management Incorporated offer having boosted yesterday’s closing price by some 0.2% to just over $3.89.
Source: Worldcasinodirectory, Worldcasinonews