Key points:
- PointsBet is reportedly engaged in discussions for a possible takeover exceeding $300m, although a statement has been issued to the contrary
- At least one overseas suitor from Asia has entered serious talks with PointsBet, according to reports
- The company’s share value has increased over 80% since early September, reaching a market capitalisation of approximately $290m
PointsBet may soon be the target of a takeover bid valued at over AU$300m (US$197m), according to a report from MarketScreener. The report suggests PointsBet has been involved in informal and formal discussions with potential buyers in recent months, including at least one serious suitor based in Asia.
However, PointsBet has since released a statement denying the reports.
As of 8 November, PointsBet’s market capitalisation was around $290m following a 6% increase in its share price, part of an overall rise exceeding 80% since September.
Analysts suggested any potential offer would likely be set at a premium to PointsBet’s current valuation, with any transaction expected to undergo scrutiny from regulatory bodies, including the Foreign Investment Review Board (FIRB).
PointsBet recently reported a 12% year-on-year increase in net win for Q1 FY2025, reaching AU$65.3m ($42.9m), with growth observed in its core markets of Australia and Canada.
The Australian division recorded a 7% rise in net win, while Canada saw significant expansion with a 62% increase, attributed largely to higher demand for in-play betting options.
Good to know: PointsBet’s decision to focus on Australia and Canada follows the sale of its US operations to Fanatics Betting and Gaming for AU$225m earlier this year
The company has been optimising its operational costs, which included reducing marketing expenses and improving efficiency across its platform. At the end of Q1 FY2025, PointsBet’s cash reserves stood at AU$33.6m. The company maintains a goal of achieving cash flow break-even by the close of FY2025.
This divestment allowed PointsBet to focus its resources on growth in its primary regions. The strategic shift may have enhanced PointsBet’s appeal as a takeover candidate, as the company continues to report stable growth in net win and operational efficiency across its core markets.
The current share price of PointsBet is AU$0.98, although it remains to be seen how the market reacts to its denial of the reports.
