MGM Resorts receives all regulatory approvals for $607m LeoVegas acquisition
MGM Resorts International has received all the relevant regulatory and governmental approvals to go ahead with its $607m acquisition of Stockholm-listed LeoVegas.
First announced in May, the proposed acquisition will see the American casino giant pay SEK61 per share for LeoVegas for a total value of around $607m.That price represents a 44% premium on LeoVegas’ closing stock price on 29 April, the last trading day before the announcement was made on 2 May.
Following the announcement, LeoVegas’ board of directors unanimously recommended that shareholders accept the bid. That included the business’ largest shareholder and CEO, Gustaf Hagman, who said at the time: “I see huge potential in what LeoVegas and MGM could achieve together.
“MGM Resorts have been working on creating the best offline casino experience for a long time, and we’ve done the same for the online experience. Merging the two is a very exciting prospect.”
While MGM has received the necessary regulatory approvals to move ahead with the deal, all other conditions specified in the offer document still apply.
The acceptance period for the offer began in early June and will expire next week on 30 August.
Settlement for shares tendered in the offer is expected to take place as soon as MGM can confirm that all other conditions for the offer are fulfilled.
LeoVegas CEO Gustaf Hagman: “I see huge potential in what LeoVegas and MGM could achieve together. MGM Resorts have been working on creating the best offline casino experience for a long time, and we’ve done the same for the online experience. Merging the two is a very exciting prospect.”
Provided such an announcement is made no later than 31 August, settlement is expected to be initiated on or around 7 September, MGM said.
MGM’s online offering, BetMGM, continues to take the lead in the US online casino market in 2022, with gross gaming revenue share in its operating markets of almost 30%.
That figure puts the brand ahead of its two closest iGaming competitors, FanDuel and DraftKings, by close to 50%, and well clear of Caesars which takes up the fourth position.
While full commercial online casino offerings such as slots and table games are only available in a handful of US states, these options have so far proven to be much more lucrative per capita than digital sports betting.
For example in New Jersey, operators generated $815m in online casino gaming revenue during the first half of calendar year 2022. Online sportsbooks generated $309m in revenue during that same period.
The latest financial information published by LeoVegas showed that the business generated €98m in revenue during Q2 2022, representing year-on-year growth of just 1% as headwinds in several European markets were partially offset by growth in the Nordic region and new market entries.
However, excluding the Netherlands market – previously an important jurisdiction for LeoVegas before it was forced to withdraw from the market following the introduction of the country’s Remote Gambling Act – revenue grew by 9% year-on-year, the operator said.