^ Back to Top

Australian $11.3 Billion Gaming Giant Merger

Australian $11.3 Billion Gaming Giant MergerTwo of Australia’s biggest gambling companies, Tabcorp and Tatts have just agreed to merge to create an $11.3 billion mega-merger.

The merger of these two companies will create a near monopoly that will control 90 percent of Australia’s gambling revenue which is in excess of $5 billion.  The combined market value of both companies is worth around $8.6 billion.

The decision was made with a unanimous consent by the board of director of both companies where they agreed to a script and cash deal giving Tabcorp control of the merged companies.

Shareholders of Tatts will receive 0.8 shares plus 42.5 cents for each of their share which will be at a 20 percent premium along with a $500 million share buyback once the merger is complete in 2017.

Tabcorp chairmen, Paula Dwyer said that “combining our two complementary businesses will give us a national footprint and could create a pathway to larger wagering pools.”

Even though the merger has been agreed upon by the board of director of both companies, it must then be approved by the shareholders as well as the ACCC (Australian Competition and Consumer Commission) which has already expressed reservations about such a merger that had been suggested back in 2006.

For the moment, the ACCC is talking to both companies and will launch a public review once it receives a submission about the proposed merger. According to an ACCC statement, “the proposed merger will require a public review that will examine a range of potential issues and areas of overlap, with focus on various gaming and wagering services”.

Even though the ACCC had blocked a similar bid for a merger back in 2006, online sportsbooks and stock analysts do not expect to see any major obstacles that would block the merger this time around.  In fact, some believe that this merger is based on competing against overseas competition from top sportsbooks such as Betonline.ag and BetPhoenix.ag.

If the merger goes through, David Attenborough, the current Tabcorp Chief Executive will run the newly merged company while Robbie Cook, the Tatts Chief Executive will retire from the business.

The deal is will also provide another $50 million of funding to the Australian racing industry through bigger gambling pools.  Mid-2017 is when the deal is expected to be completed and the integration of both companies is not expected to be completed until 2019.

BetOnline

Hot Sportsbook

Big Bonus Sportsbook

Bet on Sports at CRsportsBet.ag

Popular Sportsbook