Peter V’landys, boss of Racing NSW, has warned that any potential agreement aimed at purchasing the betting business of Tabcorp would need to be approved by him. And, for The Age and the Sydney Morning Herald, he made it clear that he would not give this approval lightly.
Currently, the Australian gambling giant relies on long-term betting licences issued by each state, with the local racing regulators playing a major role in the certification process. The company’s exclusive licence in Victoria is set to expire in 2024 but, for the time being, Racing Victoria refused to make any comments on any possible deal regarding Tabcorp’s betting assets.
Earlier this week, Tabcorp officially confirmed that it had been approached by potential suitors of its betting business, which has been experiencing some financial troubles lately.
British gambling operator Entain has revealed its interest in taking over the wagering assets of the Australian gambling giant. In a statement released a couple of days ago, it explained that it had made a non-binding indicative offer for the acquisition of Tabcorp’s betting assets and the related media business that currently runs most of the TAB operations on the territory of Australia.
At the time Entain confirmed its interest in taking over the business, it also said that discussions are at an early stage. The British gambling company further noted that any potential deal is to be executed in line with the merger and acquisition strategy of Entain, as well as with its policy for further expansion in regulated international markets.
Tabcorp Board Says Receiving Transaction Offers Does Not Necessarily Result in Sale
A potential takeover of the struggling wagering assets of Tabcorp would present a great opportunity to Entain to take over an attractive business. If combined with the already existing and operational Australia-based assets of the British gambling group, Entain would have a leading, integrated multi-channel and multi-brand betting operations.
Since Tabcorp confirmed that it had been approached with offers of potential acquisition deals for its wagering assets, its shares have gained more than 10% and continued to rise on Wednesday trading, reaching an AU$4.63 high.
As Casino Guardian previously reported, the struggling betting and media arm of Tabcorp is estimated at AU$2.3 billion. A potential acquisition deal could see it sold for about AU$3 billion. Furthermore, a sale of the assets would highlight the company’s lottery business that has been estimated at AU$10 billion.
As City’s analysts Bryan Raymond explained for the Sydney Morning Herald, the prospects of Tabcorp disposing of its betting services is a lucrative one, considering the fact that a stand-alone lotteries business would be placed among the highest-quality defensive businesses in the country.
The board of the Australian gambling company warned about the prospects of the unsolicited proposals for a potential transaction from various parties, saying that the offers were not only confidential, but also indicative and non-binding. They would also be subject to multiple conditions, such as required regulatory approvals, financing and due diligence. The board further noted that receiving takeover offers does not necessarily mean a transaction would occur.
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Olivia Cole
