Recently, it was announced that a landmark proposition between DraftKings and Entain had collapsed. Following several weeks of negotiations, which culminated in DraftKings offering a princely sum of $22.4 billion for UK-based betting company Entain, the proposal ultimately fell through. At the near-final post, DraftKings backed away from the offer, citing an unwillingness to meet demands laid out by Entain.
On the other side of the table, Entain also expressed a discomfort toward DraftKings’ offer. As part of the grand takeover, DraftKings proposed an offer made up of both cash and stock, of which the latter was the majority. This aspect reportedly caused apprehension among Entain’s board, causing the proposal to waver.
Following the announcement of the collapse, DraftKings experienced an instant boost in stock value, while Entain suffered a slight loss.
The Sheer Value of Betting
When the news broke regarding DraftKings’ proposal to secure Entain for $22.4 billion, it was met with great anticipation. It would have been a marriage between industry titans, with a globalisation of betting like never before. In the last few years, Entain has grown rapidly, and at the start of 2021, the organisation rejected a massive $11 billion offer from MGM.
In August of 2021, Entain secured the purchase of Unikrn, a specialist esports betting platform that had experienced a sharp rise in popularity in a relatively short period of time. Following the transaction, Unikrn was taken offline, with a huge promise that the platform would return in 2022 in earnest.
Once upon a time, esports betting wasn’t worth much overall; now, these platforms are changing hands for millions, if not billions, of dollars. DraftKings recognises the future potential of the industry, and promises further growth, suggesting that this isn’t the final offer it will make for Entain. In a statement, Jason Robins, the CEO for DraftKings, stated:
Based on our vertically integrated technology stack, best-in-class product and technology capabilities and leading brand, we are highly confident in our ability to maintain a leadership position and achieve our long-term growth plans in the rapidly growing North America market.
Anyone interested in betting in the North American market should familiarise themselves with this organisation. To answer that, we’ve compiled a comprehensive DraftKings review.
Looking to the Future
Entain remains in a valuable position following the collapse of this proposal. The UK-based betting company boasts a lucrative portfolio, and as a whole, the betting and esports betting industries are only growing exponentially over time. In a release posted by the Entain Group, it was highlighted that there were high hopes for the future of Entain:
Entain’s management remains focused on executing its growth and sustainability strategy and on delivering the opportunities laid out in Entain’s capital markets event on 12 August to treble its total addressable market to c.$160bn.
One of the key opportunities identified was the potential to ‘extend into new interactive entertainment experiences such as in the emerging esports wagering market’. As time goes on, esports betting is become a massively popular and valuable vertical, and companies like Entain and DraftKings are forming the backbone of that rise.