An Australian firm specializing in wagering technology, BetMakers, has entered the competition to purchase Tabcorp’s betting and broadcasting segment. Their proposal, valued at approximately $3.1 billion US dollars (equivalent to $4 billion in Australian currency), presents a unique proposition to Tabcorp.
The intriguing aspect lies in BetMakers’ proposed transaction structure. Tabcorp would initially receive a substantial $1 billion cash payment. To facilitate this, BetMakers would likely seek financing through debt arrangements. However, the remaining $2.1 billion would be disbursed in the form of BetMakers’ own company stock. Consequently, Tabcorp stakeholders would become majority shareholders, holding around 65% ownership, of the merged entity.
It’s worth noting that this isn’t the first instance of interest in Tabcorp’s betting and broadcasting unit. They have already received entirely cash-based offers, both in the vicinity of $2.5 billion USD, from Entain and Apollo Global Management.
A key strategist for BetMakers, Matt Tripp, appears quite enthusiastic about the possibilities this deal presents. He posits that a merger with BetMakers would unlock substantial expansion prospects for Tabcorp’s betting and broadcasting operations. He is particularly keen on bolstering the Australian horse racing sector, which heavily depends on Tabcorp’s TAB brand. Tripp views this as mutually beneficial, advantageous for both companies’ investors and providing Tabcorp’s betting and broadcasting business a platform to excel globally.
BetMakers contends that their proposition surpasses a straightforward cash acquisition as it affords Tabcorp’s shareholders greater choices and adaptability in the future.
The firm also emphasized the benefits of this amalgamation over the division of Tabcorp’s betting and broadcasting units. By “utilizing BetMakers’ technology and established worldwide network,” the union will “hasten the execution of a global content revenue generation expansion plan.”
BetMakers Chief Executive Officer Todd Buckingham further noted, “Expanding upon BetMakers’ achievements thus far, the consolidated entity will be one of the most extensively disseminated networks within the international racing sector and possesses an attractive investment outlook. We are distinctively situated to pursue business prospects globally, particularly within the United States market.”