Entain tumbles as MGM takeover speculation quashed
By Michele Maatouk
Date: Thursday 09 Feb 2023
(Sharecast News) - Shares in Ladbrokes owner Entain tumbled on Thursday after rumours of a possible takeover by MGM were quashed.
Analysts at Jefferies pointed to the fact that on a call for MGM's fourth-quarter results on Wednesday, the company's chief executive commented that MGM had "moved on" from Entain.
In a research note, Jefferies reported the CEO as saying: "So I think it's time to be definitive and give a little direction. The simple answer on Entain is no, we've moved on... So, for now, the answer is no, not with Entain, we're going to go down our own direction... We value the relationship within Entain, we value BetMGM. But as it comes to rest of the world, we're going to move forward with a different proposition."
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: "Speculation that MGM might be ready to make a move were shut down by the company during an analyst call.
"BetMGM, Entain's joint venture with US-based MGM, has been a shining light for the group that's expected to start turning a profit over the second half of 2023 and that's partly why the rumour mills have been whirring."
At 0930 GMT, Entain shares were down 10.3% at 1,406.50p.
MGM had approached Entain in January 2021 with an all-share offer of 0.6 MGM shares per Entain share.
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