No certainty of a transaction as Tabcorp confirms several proposals

Tabcorp has confirmed that it has received “a number of unsolicited approaches and proposals,” following speculation of a transaction involving its wagering and media business.

The group made the confirmation in a statement to the Australian Securities Exchange, however, it is noted that despite the interest from multiple parties “there is certainty that any transaction will occur”.

Despite taking full control of Australian retail betting in 2017 following its merger AU$11bn merger with rival Tatts Group, Tabcorp’s wagering units have floundered year-on-year against increased competition from online competitors. A potential transaction would see the underperforming wagering arm split from its lotteries counterpart.

“Tabcorp confirms that it has received a number of unsolicited approaches and proposals in relation to a potential transaction involving Tabcorp’s wagering and media business,” the group said in its ASX address.

“The proposals were expressed to be confidential, indicative, non-binding and subject to numerous conditions involving due diligence, financing, and various regulatory approvals.”

As well as asserting that there’s no guarantee of a deal being struck, Tabcorp added that it would assess the proposals and update the market in due course.

One such interested party is Entain, with the global betting and gaming group yesterday confirming that it has made a non-binding indicative offer to acquire the wagering and media business.

Acknowledging that discussions are at any early stages, the company said that any transaction would fall in line with its current M&A strategy of expansion across regulated international markets. 

The firm says that it views the “attractive business” proposition as an opportunity to merge its existing Sportingbet franchise with Tabcorp properties to create a “leading, integrated multi-channel and multi-brand wagering company”.

According to company records, wagering and media is Tabcorp’s most lucrative division following its lotteries and Keno operations, generating 40 per cent of its AU$5.22bn in revenues as of June 2020.