MGM Is Offering to Buy LeoVegas for $607 Million to Expand Its Presence Beyond US Shores

By John Isaac,
Editor at online-gambling.com

John Isaac Editor at online-gambling.com

John Isaac is an editor with many years of experience in the gambling industry. He writes expert articles on card games like blackjack and poker. In addition, he is also well aware of the US gambling laws and the Indian and Dutch gambling markets. You can rely on verified information and insightful details.

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Last updated: May 14, 2022

The US casino and entertainment group MGM Resorts has submitted a takeover offer of LeoVegas. The SEK 61 (€5.90) cash-per-share takeover has been unanimously recommended to investors by the board of LeoVegas AB. The terms published by LeoVegas a few days back advised shareholders to accept the offer. The offer placed a 44% premium on the closing price of the firm’s SEK 42.3 (€4.10) on the Stockholm Nasdaq as of 29th April.

MGM Resorts bid values LeoVegas’ enterprise at an estimated SEK 5,957 million ($607/€580 million). Payment for the transaction will be made through MGM’s existing cash reserve. Imperative to LeoVegas’ plan to establish a dominant and globally-scaled online gambling business, the transaction sees MGM carry out its iGaming vision beyond US borders.

The Offer Is a Compelling Opportunity, Says Bill

A statement by MGM President Bill Hornbuckle says,

“We believe that the offer creates a compelling opportunity that allows the combined teams of MGM resorts and LeoVegas to accelerate our global digital gaming growth and fully realize the potential of our omnichannel strategy. We look forward to being able to welcome the LeoVegas team to our MGM Resort family.”

With BetMGM having achieved remarkable success in the US, President Bill hopes the takeover of LeoVegas in Europe will help expand their global online presence. MGM’s acquisition is of strategic importance as LeoVegas’ business operations are across eight European-licensed jurisdictions. This is combined with the firm’s expert management team overseeing services of its multi-brand portfolio including all igaming disciplines.

During the last year ending 31 March 2022, LeoVegas generated and adjusted EBITDA of €48 and €393 million in corporative revenues. The deal with MGM as a result is branded profit effective for the future development of the group’s online gambling business.

LeoVegas’s Board Make Recommendation to Investors

According to the recommendation made to investors by LeoVegas’s board, MGM values the talents and skills of LeoVegas’ employees and management and intends to maintain the good relationship LeoVegas has with its employees. MGM also outlined its confidence in sealing the deal as LeoVegas Chief Executive and founder Gustaf Hagman gave an irrevocable undertaking to sell the business upon recommended term.

LeoVegas board is set to announce an acceptance period for the offer. The period is expected to begin sometime around 3 June 2022 and expire on or before 30 August 2022. Developments on how MGM will go about developing its online gambling business will be closely monitored by an industry analyst.

Having secured a US wagering foothold through successful ventures that include BetMGM sportsbook joint-venture with FTSE100Entain Plc., developments after this deal will particularly be interesting to many other analysts.

Entain’s subsequent takeover has since been mooted for some time now. Entain has a US wagering proposition that MGM is expected to take full control of. Yet an $11 billion offer was rejected by Entain in 2021. It fell through because cooperate governance deemed MGM to have significantly undervalued prospects.