MGM Acquiring LeoVegas Looks Imminent Pending a $607 million offer

News of MGM acquiring LeoVegas has full BOD member recommendation. However, will the required 90% of shareholders vote in favour? (Photo by Paul IJsendoorn pexels.com)

Once again, a NASDAQ Stockholm company is the subject of a multi-million Euro takeover—a coincidental trend, maybe. This time is LeoVegas AB (owner of LeoVegas live casino) the subject of what looks like a done deal after the board of directors recommended to shareholders that MGM acquiring LeoVegas is a deal worth accepting.

MGM Resorts International, a huge US gambling firm, is regularly linked with various gambling companies, including a persistent crack of the whip at acquiring Entain as MGM’s chief executive and president of MGM Resorts Mr. Bill Hornbuckle has always planned on taking MGM into European iGaming markets. The Entain/MGM saga continued to make its way into casino news networks throughout 2021, but that deal appears to have been all but dead in the water for quite some time now after Entain rejected MGM Resorts’ bid. However, both companies still operate as partners in the US.

Now MGM has pulled out a new deck of cards and found a fresh potential match made in heaven, and what better brand than a brand like LeoVegas should the opportunity arise, which course it has. It seems LeoVegas bigwigs are not quite as resistant as Entain, quite the opposite. Judging by the Board of Directors’ comments encouraging shareholders to accept the deal, it is fair to say LeoVegas AB upper management is rather happy with the prospect of their company being operated under one of the USA’s most formidable casino management companies.

In comparison, MGM Resorts International has a proven track record. Since its 1987 inauguration, the company boasts US$ 12 billion a year of revenue and has over US$ 33 billion in assets and US$ 7 billion assets. LeoVegas AB founded in 2011 is worth an estimated € 328 million in revenue. That said, recent LeoVegas financial reports show year-on-year revenue growth to $445 million, however, year-on-year net profits significantly fell by 38.9%.

Nonetheless, MGM is clearly en route to becoming the new owner, and a takeover would mean the LeoVegas brand is joining a mega US powerhouse that should see LeoVegas grow immensely with all that extra financial backing. Although nothing is set in concrete, common sense prevails here.

MGM LeoVegas Fresh Competitors: Ironically enough BetMGM and LeoVegas have never really been major competitors in sports betting or iGaming. That is until recently when both companies opened MGM Casino and LeoVegas casinos in the Canadian iGaming market in direct competition.

Why is the MGM Acquiring LeoVegas Deal Seemingly a Done Deal?

Of course, where shareholders are involved, a round of votes must approve the buyout but rarely do we see the company board of directors, in this case, LeoVegas, strongly suggest voting in favour of the deal.

Rewind to the London Stock Exchange (LSE) Playtech takeover by Aristocrat which was then bombarded with additional offers from Gopher Investments, JKO Play, and rumours of other parties buying shares to gate crash a side deal from China. In the end, shareholders voted against Aristocrat and all other possible buy-out possibilities waned.

In the case of Evolution’s takeover bid of NASDAQ Stockholm NetEnt, the board of directors at no point suggested to shareholders voting in favour of the takeover was the best move. Instead, the company provided all the facts openly to their shareholders, explained that Evolution is a great company, and then left the voting entirely up to the shareholders without being as explicit as LeoVegas.

LeoVegas BOD Statement is Unwavering: board of directors whose exact words in their official statement by the board of directors here “The Board of Directors of LeoVegas unanimously recommends the shareholders of LeoVegas to accept the public offer from MGM of SEK 61 in cash per share”.