Given the fact that the company has been extremely busy this year with some notable acquisitions, it is perhaps unsurprising that UK-based betting giants Entain have sought a little wriggle-room when it comes to its liquidity and purchasing power.
As a result of that, the company has announced that it has increased the value of its First Lien Term Loan B from the initial $750m to $1.00bn (a $250m increase).
The reason given for the increase in borrowing is to help fund two major purchases the company made of sports betting commodities in the Netherlands and Croatia, as well as to give the company further financial liquidity for the foreseeable future.
Demand From Investors
Regarding the increased loan, Entain has said that increased demand from credit investors around the world had played a part in its decision and that also in agreeing the increase, this means that the company will now no longer need funding from Entain’s revolving credit facility for the purchase of one key betting service.
Earlier this year, Entain announced that it had agreed to acquire the Netherlands-based BetCity betting platform.
The extension of the loan will help cover the costs associated with the BetCity deal as well as giving the company extra leeway to finance its 75% stake in the Croatian betting service SuperSport, which it agreed to back in August 2022.
That news came just a short time after the Entain appointed Rahul Welde as its new Independent Non-Executive Director.
Given the company’s extensive moves within the sports betting and esports industries this past year, it is clear that the company is seeking to maintain the momentum it has gained over the last few years when exploring and moving into new markets around the world.
The company has announced that the cost of financing the additional loan amount will be 6.2% until September 2024, but that this amount will not include amortisation of fees incurred and any original issue discount.
It is now expected that the deal for BetCity will be completed in Q4 as expected back in June, but there is no firm completion date for the deal with SuperSport noted.
What Does This Mean For Entain’s Investors And The Company’s Future?
Given that Entain now owns a number of different sports and esports betting sites all over the globe, the increase in the loan will mean the company is able to press on with the acquisition of two new sites in the Netherlands and Croatia, without having to source capital in other ways.
That increase in loan value would not have been possible without lots of interested investors seeking to invest in the company as it moves forward with its plans to expand around the globe.
Additionally, the greater liquidity of funds means that Entain will also have more flexibility moving forward to secure further acquisitions and investments into other sports and esports markets around the globe.
Given the growth of these markets in recent times, it is not surprising to see investors keen to become a shareholder in Entain as the company seeks to become a global leader in both sports and esports betting industries.