Morgan Stanley-backed consortium joins Tatts Group bidding war
Financial consortium looks to scupper Tabcorp’s merger with the operator with £4bn takeover proposal
Tatts Group today said its merger with Tabcorp remained in the “best interest” of shareholders despite receiving a AU$7.3bn (£4.3bn) takeover from a major financial consortium.
The Brisbane-based operator this morning confirmed press reports that a financial consortium including Morgan Stanley, Kohlberg Kravis Roberts and Macquarie Group had made a proposal to acquire 100% of Tatts Group.
The Macquarie-led bid has offered $4.40 to $5 per share for the operator, to be financed through a combination of equity and debt, which is slightly higher than the $4.34 offer from Tabcorp.
As part of the deal, the consortium plans to split Tatts Group’s lottery operation from its wagering & gaming arm, and either sell off or list the latter business separately.
Tatts said it would now assess the proposal from the financial consortium and provide a further update on the outcome of the review in the coming weeks.
“In the meantime, the Directors of Tatts continue to believe the Proposed Tabcorp Merger is in the best interests of Tatts Shareholders and unanimously recommend the Proposed Tabcorp Merger,” the operator said in a statement.
“The Tatts Board remains fully committed to acting in the best interests of, and maximising value for, Tatts shareholders.”
Tabcorp has itself been the subject of M&A speculation following reports Ladbrokes Coral was ready to with a multi-million pound bid for the operator. However it is understood Ladbrokes Coral has no interest in acquiring Tatts.
Tatts Group’s share price increased 8.45% to $4.49 today following the news of the financial consortium’s takeover proposal.