Key points:
- PointsBet board maintains support for Mixi’s $1.20-per-share cash scheme and takeover alternative
- Company says Betr’s all-scrip proposal equates to $1.05–$1.14 per share based on 20 June pricing
- Betr already holds 19.9% of PointsBet and intends to vote against the Mixi scheme on 25 June
PointsBet Holdings has issued its first detailed response to Betr Entertainment’s indicative, all-scrip takeover proposal, telling investors the approach is presently inferior to the cash offer tabled by Japanese technology group Mixi.
In a 23 June market filing, PointsBet reiterated that Mixi’s scheme of arrangement values the operator at A$1.20 per share in cash.
By contrast, PointsBet said Betr’s proposed 3.81-for-1 share exchange was worth between A$1.05 and A$1.14 per share based on Betr’s recent trading range, with the final consideration fluctuating alongside Betr’s share price.
The company noted that Betr’s offer remains subject to shareholder approval, Australian Competition and Consumer Commission clearance and Ontario gaming approvals. It also highlighted uncertainty over a selective buy-back facility – capped at A$80m ($52m), potentially rising to A$200m – that Betr has presented as a path to liquidity for investors opting for cash.
Good to know: On 20 June, Betr publicly outlined its planned bid, positioning it as a rival to the Mixi scheme that PointsBet directors unanimously support
PointsBet’s board said: “The Betr Potential Takeover Offer provides no cash certainty for all PointsBet shareholders. The value is significantly lower than under the Mixi Scheme and Mixi Takeover.”
The directors also questioned Betr’s synergy estimates, describing them as “materially overstated.”
The company’s analysis indicated a material overlap between the two businesses, with 65% of turnover and 61% of net win stemming from customers who hold accounts at both operators. It warned that revenue dis-synergies could offset any cost savings.
Proxy votes for the Mixi scheme meeting, tallied ahead of the 25 June shareholder vote, suggest the proposal may fall short of the required majorities if Betr’s 19.9% holding is excluded. Without scheme approval, Mixi has committed to launch an off-market takeover bid at the same A$1.20 cash price.
PointsBet confirmed it will review any formal bidder’s statement from Betr before issuing a recommendation to shareholders.
Until then, the board continues to support the Mixi transaction in the absence of a superior proposal and subject to the Independent Expert continuing to conclude that the scheme is in the best interests of shareholders.
