Higher offer made by PointsBet in face of prior rejection by Betr
In a recent turn of events, PointsBet has continued to reject Betr's takeover bids, including the most recent increased all-scrip offer. Instead, the company has expressed support for a competing all-cash acquisition offer from MIXI Australia.
The board at PointsBet has described Betr's proposals as "materially inferior" to MIXI's cash offer of A$1.20 per share. The reasons for this preference lie in the greater security and shareholder benefits offered by MIXI's bid, as well as concerns about Betr's financial performance and revenue model.
PointsBet has flagged significant risk in Betr's business due to over 50% of Betr's net win in January 2025 coming from just 20 customers. This concentration of revenue among a few VIP bettors raises concerns about the stability and sustainability of Betr's business. Additionally, regulatory risks associated with Betr's revenue structure have been cited as a concern.
Betr, however, is not deterred and has renewed its all-cash bid for PointsBet. The new offer values each PointsBet share at approximately AU$1.20, a significant increase from previous offers. Betr urges shareholders to wait for both final offers before making a decision.
It remains uncertain if MIXI will raise its offer again. PointsBet, on the other hand, will need to review the renewed all-cash bid from Betr before scheduling a shareholder vote for a final decision.
The ongoing negotiations between the two companies have been marked by contrasting views. While PointsBet has previously rejected a bid from Betr due to concerns about the potential buyer's revenue-generating and business strategy, Betr remains confident in securing the partnership with PointsBet. The Japanese entertainment group, MIXI, initially backed by PointsBet, received approval for the deal in Ontario, Canada.
Betr continues to believe in the combination of the two businesses for profitable growth in the Australian wagering market. The company insists that its new bid offers a far better value compared to previous offers and that the all-cash transaction put forward by MIXI is inferior.
As the negotiations continue, the future of PointsBet and its partnerships remains uncertain. However, one thing is clear: both Betr and MIXI are determined to secure a deal with PointsBet, and the decision rests with the company's shareholders.
Investing in PointsBet may prove more secure with MIXI's all-cash offer, given the company's reservations about Betr's financial performance and revenue model. Betr contends that its renewed all-cash bid for PointsBet offers a superior value compared to previous offers, countering MIXI's perceived advantages.
