The ongoing saga of PointsBet’s takeover has a new chapter following shareholder voting on the company’s future.
Earlier today (25 June), PoinsBet announced that shareholders had approved a proposed AUS$402m (£295.1m) cash takeover by the Japanese digital entertainment group Mixi.
However, Betr, which has repeatedly courted its own takeover of PointsBet and owns a 19.9% share in the company, accused the Chair of the meeting of excluding Betr’s votes against the scheme and demanded a recount.
Betr said in a statement: “It appears that the chair of the meeting has impermissibly excluded Betr’s vote against the Scheme and provided no basis for doing so.
“The company confirms it validly lodged its proxy vote against the Scheme as recorded in the PointsBet announcement this morning. Betr did not, at any time, revoke that proxy.”
If included, some analysts suggested Betr’s dissent could have thwarted the approval of the takeover.
PointsBet has since rejected the accusations, confirming that “one of Betr’s senior company officers validly logged into the Scheme Meeting virtually and revoked Betr’s proxy on Betr’s behalf prior to the close of the poll”.
They then did not lodge any votes for Betr at the scheme meeting, PointsBet continued.
The offers
Mixi is offering $1.20 per share for PointsBet, valuing the Melbourne-based operator at the aforementioned figure of $402m.
On the other hand, Betr has tabled an all-share proposal which offers 3.81 Betr shares per PointsBet share and a selective buyback operation capped at $80m, potentially rising to $200m if Betr secures 90% of the company.
This values PoinstBet at approximately $360m and was previously deemed a ‘superior proposal’ by PoinstBet compared to Mixi’s initial $353m offer. However, the Japanese company subsequently improved their bid to the current valuation.
In an update to investors on Monday, PointsBet dismissed the Betr offer out of hand, describing its value as “significantly below” that of the Mixi offer.
PoinstBet continued: “The value of the Betr potential takeover offer will change over time, given it is an all [share] proposal, and the cash value realisable by PointsBet shareholders (should they wish to sell any Betr shares issued to them) is uncertain given the low liquidity of Betr’s shares on ASX. Hence, the Betr Potential Takeover Offer provides no cash certainty for all PointsBet shareholders.”
If Betr were to merge with PointsBet, they would combine to take 10% of Australia’s market share, which Tabcorp, Sportsbet and Entain dominate.
However, PointsBet has pointed to Betr’s reliance on “volatile” and “less valuable” VIP customers and a high overlap of players. 65% of turnover and 61% of net win came from customers who hold accounts with both operators.
What’s next
Given Betr’s continued pursuit of the Australian market share, previously merging with BlueBet and expanding its geographic reach via the takeover of TopSport in the Northern Territory, it is likely that there will be more twists and turns before any takeover is complete.
The company, led by Matthew Tripp, has reaffirmed its commitment to preparing its unconditional takeover offer directly to PointsBet’s shareholders.
On the other hand, Mixi’s offer remains the front runner in the eyes of PointsBet and will proceed to a Second Court Hearing, which is scheduled for tomorrow (26 June).
If successful, Mixi intends to take PointsBet private and in a statement, it welcomed the “strong support” of PointsBet shareholders and is also monitoring the Betr situation closely.
