DraftKings CEO: People are betting on table tennis and Tiger King during the pandemic

London (CNN Business)MGM Resorts International is attempting to buy the owner of British gambling brand Ladbrokes, making it the latest US casino operator to place a significant wager on the fast-growing online betting industry during the pandemic.

Ladbrokes owner Entain said in a statement Monday that it has received an £8.1 billion ($11.1 billion) proposal from MGM (MGM). But Entain added that it believed the offer, which represents a 22% premium over its closing price on December 31, “significantly undervalues” the company’s shares and its prospects.
“The board has also asked [MGM] to provide additional information in respect of the strategic rationale for a combination of the two companies,” Entain said. The UK company has received multiple proposals from MGM, its statement suggested. Representatives for MGM did not immediately respond to a request for comment.

    Shares in Entain increased more than 26% on Monday, surging above the price per share offered by MGM in a sign that some investors expect another offer from the US company or another bidder. MGM is a major player in Las Vegas, operating casinos including the Bellagio and Mandalay Bay.
    The companies have an existing relationship. MGM and Entain are joint owners of BetMGM, a sports betting and online gaming company that operates in more than a dozen US states. Entain, which owns brands including Eurobet, Ladbrokes and Sportingbet, operates both retail and online businesses.

    Nicholas Hyett, an equity analyst at Hargreaves Lansdown, said that he “can understand why MGM wants to take control” of Entain, given that the two companies are already working together on sports betting in the United States. But he cautioned that a higher price “may prove too much for MGM shareholders to swallow.”
    MGM shares dipped 0.3% in premarket trade on Monday.

    Sports betting boom

    The online sports betting industry was already growing in the United States following a 2018 US Supreme Court decision that cleared the way for it to be legalized in states outside Nevada. The American Gaming Association expects nearly 35 million people, or 13% of American adults, to bet on the 2020 NFL season.
    The pandemic has only accelerated the trend, sparking a flurry of dealmaking and consolidation.

      Caesars Entertainment (CZR) announced in September that it was buying UK bookmaker William Hill for £2.9 billion ($4 billion). Shares in DraftKings, a company that runs fantasy sports games and lets people make legal wagers on sporting events, have skyrocketed after an initial public offering in April.
      Flutter Entertainment (PDYPF), which owns Paddy Power, Betfair and Pokerstars, recently increased its stake in US sports gaming platform FanDuel.
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