MGM Resorts Makes $607 Million Offer to Buy Sweden-based LeoVegas
MGM Resorts announced Monday that it has made a public offer for 100% of the shares of Stockholm-based LeoVegas for about $607 million.
The deal signals MGM’s attempt to expand internationally, similar to what it has done in North America with its BetMGM brand, a joint venture between MGM and Entain.
With the acquisition of LeoVegas, MGM Resorts will be able to search for strategic opportunities to accelerate growth and product offerings internationally, and to use its technology capabilities to help expand that growth, the release said.
“We have achieved remarkable success with BetMGM in the U.S., and with the acquisition of LeoVegas in Europe we will expand our online gaming presence globally,” MGM Resorts' CEO & President Bill Hornbuckle said in a news release.
Founded in 2011, LeoVegas is a global online gaming company with licenses in eight jurisdictions primarily in the Nordics and the rest of Europe. One of those jurisdictions is the surging Ontario sports betting and online casino markets. LeoVegas also has offices in Malta, United Kingdom and Milan.
Deal Expected to Close by September
Pending regulatory approvals, the deal will be financed with existing cash and is expected to add growth to MGM Resorts' earnings and cash flow per share with an expected completion by September 2022, according to the release. MGM is offering $6.20 a share.
“Our vision is to be the world's premier gaming entertainment company, and this strategic opportunity with LeoVegas will allow us to continue to grow our reach throughout the world,” Hornbuckle said in the release. “We believe that this offer creates a compelling opportunity that allows the combined teams of MGM Resorts and LeoVegas to accelerate our global digital gaming growth and fully realize the potential of our omnichannel strategy. We look forward to being able to welcome the LeoVegas team to our MGM Resorts family.”
MGM is scheduled to release its 2022 first-quarter earnings later Monday. MGM, traded on the New York Stock Exchange, currently is around $41 a share.
Both Operators Live in Ontario
LeoVegas and BetMGM are both operating in the Ontario online casino and sports betting markets. They were among the first operators to go live in Ontario on April 4.
The Ontario sports betting market could be one of the strongest in North America. If it were a state, it would be the fifth largest by population. It would only be behind New York as the largest state with legal sports betting.
New York’s success (since launching on Jan. 8, New York online sports wagering operators have seen a combined handle of just short of $6 billion and a GGR of more than $412.34 million through April 24). It has collected more than $200 million in taxes thanks to its high tax rate (51%).
Lou Monaco had been East Coast Scene columnist for Gaming Today in Las Vegas since June 2019, covering the East Coast sportsbook scene with emphasis on NJ and PA. He also currently is a part-time writer for the high school sports department for NJ Advanced Media (NJ.com) in Iselin, NJ. Lou has over 30 years sports experience with previous stints at ESPN SportsTicker, Daily Racing Form and Oddschecker.