Entain (LSE:ENT) shares soared by over 18% on Tuesday after media sources reported it had received a takeover bid from US sports betting firm DraftKings. Ladbrokes owner Entain was the top performing share in the FTSE 100.
Entain shares also rose nearly 8% in early trading on Wednesday after an even higher bid offer was confirmed. After the market closed on Tuesday, Entain reported that it had received an offer from DraftKings of £28 per share. It also said that it had rejected an earlier offer of £25 per share.
The offer consists of a combination of cash and DraftKings shares. Entain’s board is due to consider the latest proposal and will announce its decision when made.
Raising the bet
An offer of £28 per share represents a premium of 24% to Tuesday’s closing price and a 46% premium to Monday’s closing price.
The offer from rival DraftKings comes after Entain rejected a much lower offer from MGM Resorts in January.
A hot sector
The bid comes at a time when the US sports betting sector is getting ever more exciting. From 2018, US states were given permission to legalise sports betting. With over 20 states having already legalised it, several others are expected to follow.
Entain thinks in the long run, the sports betting market could be worth over five times what it is today. Esports is another area of focus that is set to rapidly expand over the coming years. Â