(Bloomberg) -- DraftKings Inc. made a bid to acquire U.K. gambling company Entain Plc as a surge in sports betting helps drive deal activity across the industry.
Entain said Tuesday that its board received a cash-and-stock offer, confirming an earlier report by CNBC, which said the bid valued the company at $20 billion. There’s no certainty it will lead to a deal, the company said in a statement. The company didn’t reveal the price DraftKings offered.
An acquisition would dramatically expand DraftKings’s emerging gambling empire, coming just over a month after the company agreed to buy Golden Nugget Online Gaming Inc. Entain, which owns British bookmakers Ladbrokes and Coral, earlier this year rejected an $11 billion takeover attempt from MGM Resorts International, saying the bid undervalued the company during rising interest in online betting.
Entain jumped as much as 25% in London, the biggest intraday gain since Jan. 4. DraftKings shares fell 6.7% at 10:38 a.m. in New York.
The U.S. legalized sports betting in 2018, a move which sparked a spree of trans-Atlantic betting deals and a land grab for customers. Casino operator Caesars Entertainment Inc. bought Britain’s William Hill in April, Ireland’s Flutter Entertainment Plc bought the Stars Group Inc. in Canada last year, and Bally’s Corp. is currently buying Gamesys Group Plc.
The DraftKings offer for Entain could revive interest by casino operator MGM, which runs a U.S. joint venture with Entain in the U.S.
The volume of deals involving British companies has already more than doubled to $522 billion this year compared to the same period in 2020, according to data complied by Bloomberg, with number of household names drawing overseas buyers. Bids are currently on the table for grocer WM Morrison Supermarkets Plc, and defense firms Meggitt Plc and Ultra Electronics Holdings Plc.
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