A Japanese entertainment company has taken over Australian gaming operator PointsBet.
Key Takeaways
- Gaming operator PointsBet became a controlled subsidiary of MIXI Australia on Sept. 5
- MIXI purchased over 179 million PointsBet shares and has majority voting power
- U.S. sports betting and fantasy sports operator Betr’s presence in this takeover still looms
MIXI announced on Monday that PointsBet is "now a controlled subsidiary of MIXI Australia.” The company is the registered and beneficial owner of approximately 179.3 million shares of PointsBet. MIXI took over 51.86% of the voting power as of Sept. 5.
MIXI Australia also said that its $1.25 per PointsBet share offer price is final, and it will close at 7 p.m. Melbourne time on Sept. 12 without an extension. MIXI urged PointsBet shareholders to quickly accept the offer, and that they should “not delay their acceptance in the expectation of any further price increase.” The company says its offer is “full and fair, and represents MIXI Australia’s best and final offer.”
Because of the 3% creep rule, MIXI Australia will have to wait six months to acquire any more shares.
What about Betr?
PointsBet intends to accept the offer, and MIXI plans to accept an offer to have representation on the Australian gaming operator’s board, but Betr’s involvement still looms.
The U.S. fantasy sports and sports betting company made an unsolicited, conditional off-market all-scrip takeover offer that was rejected by PointsBet in July in favor of MIXI’s offer.
PointsBet cited cash concerns and “unattractive” business aspects as reasons for not wanting Betr to assume control.
MIXI Australia says it has no intention of allowing Betr to be part of PointsBet moving forward.
“Amongst other things, this means that Betr will not be able to achieve control of PointsBet nor realise the synergies estimated in its replacement bidder's statement,” MIXI said in the statement. “MIXI does not intend to engage (nor to procure PointsBet engages) in any such collaboration with Betr.”
Don’t bet on it
Australia’s Takeovers Panel issued a statement consenting to Betr’s variations request, which removes requirements for the U.S. gaming company to seek shareholder approval for MIXI’s participation.
Betr’s relevant interest in PointsBet only amounted to 20.45% of shares. Betr’s buy-back was determined to be “not fair but reasonable to non-participating Betr shareholders if Betr’s eventual shareholding in PointsBet is between 20% to 35%.”
Betr’s proposed buy-back is subject to the “passing of a special resolution” at a Sept. 22 Betr shareholders meeting. MIXI argues that there is no guarantee that the buy-back will occur.
In July, Betr offered 3.81 of its shares in exchange for each PointsBet share, claiming a AU$1.22 per market value share, based on Betr’s $0.32 price. Betr added $44.9 million in expected annual cost synergies, which would’ve only been available if Betr took over 100% of PointsBet, to reach a share price of $1.89, something PointsBet didn’t see as attainable.
