PointsBet not planning to engage further with BlueBet bid
Operator’s chair, Brett Paton, tells shareholders to back the MIXI offer as he reaffirms company’s stance that BlueBet proposal is not fully funded
PointsBet does not intend to further engage with BlueBet regarding its bid for the business, instead imploring shareholders to back the scheme implementation plan put forward by MIXI.
In a letter addressed to investors and signed by PointsBet chair Brett Paton, the Australia- and Canada-facing operator made clear that it deems the BlueBet offer weak compared to MIXI.
MIXI, a Japanese conglomerate that operates the betM brand in the Northern Territory, has offered PointsBet shareholders A$1.06 (51p) per share, a 27.7% premium on the previous closing price on 27 February.
Total enterprise value of the MIXI bid is set at $353m, compared to BlueBet’s cash-plus-scrip deal worth between A$340m and A$360m.
Paton’s letter was published after BlueBet said it was continuing to have “overwhelmingly positive” talks with PointsBet shareholders, suggesting the tide may be turning in its favour.
However, Paton confirmed that the PointsBet board “unanimously recommends” shareholders back the MIXI deal in the “absence of a superior proposal”.
PointsBet had previously told shareholders that BlueBet’s bid was “unfunded” despite the bidder’s claim its offer was “fully funded”.
Paton’s letter outlined that BlueBet would have to raise both A$100m in debt and around A$160m in capital to seal the deal, with the value for shareholders also “heavily dependent on assumed synergies”.
The chair added that the A$160m capital raise required would represent 77% of BlueBet’s market cap, as of 1 April.
Patton also noted, as per BlueBet’s public statements, that pro forma corporate cash balance was under $A15m, as of the end of 2024, and the business had negative operating cash flows of A$14m.
Paton wrote: “Given the above, and based on other materials presented to PointsBet, it is clear that the BlueBet proposal could not reasonably be characterised as ‘fully funded’.
“Notwithstanding BlueBet’s recent statements, the core issues outlined above have not been adequately addressed by BlueBet and thus PointsBet does not intend to further pursue the BlueBet proposal.
“The BlueBet proposal was expressed to be non-binding and indicative and is not currently capable of acceptance by PointsBet shareholders.”
PointsBet shareholders will vote on MIXI’s offer in June.