BetMakers Technology Group (ASX:BET) stock was halted today by the Australian Stock Exchange (ASX). It came at the request of the sportsbook operator pending the announcement of a “material acquisition.”
In a statement revealing the halt, ASX included a letter from Charly Duffy, BetMakers company secretary, requesting that trading activity in the shares be stopped until Monday, June 21. BetMakers isn’t aware of any reason why “the halt should not be granted,” according to the letter.
“The Securities of BetMakers Technology Group will be placed in trading halt at the request of BET pending it releasing an announcement,” said ASX. “Unless ASX decides otherwise, the securities will remain in a trading halt until the earlier commencement of normal trading on Monday, June 21, 2021, or when the announcement is released to the market.”
Particularly with the company saying an acquisition reveal is forthcoming, the BetMakers share stoppage is certain to invite ample speculation. That’s because Tabcorp’s board of directors meets Sunday to discuss takeover bids for its media and sports wagering units, for which BetMakers is one of the suitors.
Interesting Timing by BetMakers
There is no mention of Tabcorp in the aforementioned BetMakers document. But news of the stock halt comes less than three weeks after the upstart sportsbook operator threw its hat into the ring for its bigger rival’s media and sports betting businesses.
Late last month, BetMakers revealed a $3.1 billion cash and equity offer for the Tabcorp assets, joining a crowded field of suitors, including private equity firm Apollo Global Management (NYSE:APO) and UK-based bookmaker Entain Plc (OTC:GMVHY).
The BetMakers proposal surprised some Australian gaming market observers simply because the operator is far smaller than Tabcorp, and appeared to lack the resources of an Apollo or Entain.
That’s likely why the company is including equity in its pitch. However, analysts believe that puts BetMakers at a disadvantage against the all-cash offers laid out by Apollo and Entain. That’s because, under the terms of the BetMakers offer, Tabcorp investors retain some ownership of lagging businesses they may prefer to wash their hands of.
Surprise Could Be in Store from BetMakers
BetMakers is advised by Matthew Tripp, one of Australia’s most well-known bookmakers, and one with a reputation for dealmaking. It’s possible that the company has a surprise in store, and that its acquisition announcement will not involve the aforementioned Tabcorp units.
It’s also possible that another suitor, namely News Corp Australia, could make a run at the Tabcorp assets, giving the board more to consider at its Sunday meeting.
For its part, Entain believes it’s the best match for Tabcorp, because the Ladbrokes owner already has a sizable footprint in Australia and is committed to growing its presence there. Apollo and Tripp have reputations for investing in companies only to later depart when those stakes appreciate in value.