lobal sports-betting and gaming group Entain —formerly known as GVC Holdings—, through its wholly-owned subsidiary Bwin Holdings (Malta) Limited, announced on Thursday a recommended cash offer to the shareholders of Optibet operator Enlabs AB to tender all their shares in Enlabs to Entain at a price of SEK 40 per share.
The shares in Enlabs are admitted to trading on Nasdaq First North Growth Market of Sweden, company officials said.
Entain offers SEK 40 in cash per share in Enlabs, an offer that values Enlabs at around SEK 2.80 billion (equivalent to approximately GBP 250 million at the time of this announcement).
The Independent Bid Committee of Enlabs has unanimously resolved to recommend the Company's shareholders to accept the offer. The recommendation is supported by a fairness opinion provided by Mangold Fondkommission AB.
Shareholders holding in aggregate around 42.2% of the total number of Enlabs shares have undertaken to accept the offer.
The offer represents a premium of approximately 42.3% compared to the volume-weighted average price of SEK 28.12 per Enlabs share on Nasdaq First North during the last 180 trading days prior to the announcement of the offer; approximately 15.6% compared to the volume-weighted average price of SEK 34.61 per Enlabs share on Nasdaq First North during the last 90 trading days prior to the announcement of the offer; and approximately 1.1% compared to the closing price of SEK 39.55 per Enlabs share on Nasdaq First North on 5 January 2021, which was the last trading day prior to the announcement of the Offer.
The acceptance period is expected to commence on or around 21 January 2021 and expire on or around 18 February 2021.
Enlabs is an established gaming company operating in the Baltics. Based on total revenues, the company is the market leader in Latvia, the second-largest in Estonia, and among the five largest operators in Lithuania. Enlabs is headquartered in Riga with offices in Tallinn, Vilnius, Minsk, Malta, Marbella, and Stockholm.
The Baltic region represents a highly attractive, locally regulated, and fast-growing gaming market. Entain does not currently operate in these geographies and entry is aligned with Entain's strategy to focus on growth markets that are locally regulated and taxed. The acquisition of Enlabs represents a synergistic combination with a pre-eminent operator, with high operating standards and a market-leading customer proposition.
Entain believes that a combination with Enlabs would allow Enlabs to accelerate delivery of its ambitions both in terms of growth within its existing markets and successful expansion into adjacent markets, including Belarus and Ukraine. Leveraging the combined expertise across the enlarged group would deliver an enhanced proposition to Enlabs' customers. In a highly competitive and regulated industry, Entain believes scale and diversification is essential to continue to create shareholder value. Entain places great value on Enlabs' organization and, by leveraging Entain's scale, proprietary technology, marketing skills and products, will drive further growth in order to create long-term positive effects for Enlabs employees and other stakeholders. Entain's plans for the future business and general strategy do not currently include any material changes to Enlabs' organization, management and employees, including their terms of employment, or to the locations of Enlabs' operations.
As further described under "Undertakings to accept the Offer and certain other contractual arrangements", subject to completion of the Offer, Entain intends to retain the services of Niklas Braathen, the current chairman of the board of Enlabs, to develop the Entain group's operations in the Baltic and Nordic regions and its expansion into parts of Eastern Europe.
"The acquisition of Enlabs is perfectly aligned with our strategy of expanding across new regulated international markets. We are hugely excited by the growth opportunities it presents both in its existing markets and through new market opportunities. Enlabs is already a strong and rapidly growing business in its own right, but we now have a fantastic opportunity to turbocharge its growth by leveraging the power of our unparalleled proprietary technology, scale, product and marketing expertise," said Shay Segev, CEO of Entain.
"When Entain's interest to acquire Enlabs emerged, we instantly saw the strategic logic. Our interaction with them so far has confirmed they will provide an excellent home for the company, its customers and employees. Entain's experience and track record in many different geographic markets, together with its market-leading proprietary technology and world-class marketing skills are key attractions for Enlabs as we look to grow in the Baltics and beyond. Finally, Enlabs has achieved an enormous amount as an independent business, but we recognize the established trend of industry consolidation and the growing importance of scale," said Niklas Braathen.
Entain offers SEK 40 in cash per share in Enlabs. If Enlabs pays dividends or makes any other distributions to the shareholders, for which the record date occurs prior to the settlement of the Offer, the price under the Offer will be reduced accordingly. The Offer values Enlabs at approximately SEK 2.80 billion (based on 69,924,433 shares in Enlabs).
No commission will be charged in respect of the settlement of the Enlabs shares tendered to Entain under the offer.