Entain succumbs to Enlabs shareholder pressure with improved takeover bid
Enlabs share price jumps 17% as FTSE 100 operator increases offer to SEK53 per share valuing Baltics-based firm at £316m
Entain has blinked first in its bid to acquire Enlabs after increasing its original takeover offer from SEK40 per share to SEK53 per share.
The new offer, which values Enlabs at SEK3.7bn or £316m, is final and will not be increased.
Entain’s original bid valued Enlabs at £250m.
Crucially, the new bid has been accepted by influential shareholders who rebelled against the initial offer as they felt it undervalued Enlabs and its future performance and prospects.
The increased price has garnered support from a further 8.7% of shareholders, including Alta Fox Capital (3.7%) and Hans Isoz (2.6%), meaning 51% of shareholders are keen to accept.
Isoz told EGR: “At this more balanced level, Entain still have an attractive upside and we as shareholders get some future value in cash today.”
Enlabs shareholders who had already voted to accept the initial bid, including chairman Niklas Braathen, will automatically benefit from the increased offer.
The increased offer represents a premium of approximately 88.5% to the volume-weighted average price of Enlabs on Nasdaq First North during the last 180 trading days prior to the first offer.
The acceptance period for remaining shareholders has been extended until 18 March, with settlement excepted to commence on 30 March.
Rob Wood, CFO and deputy CEO of Entain, said: “In a highly competitive and regulated industry, where consolidation is a key theme, Entain is able to provide the scale and platform needed to further support Enlabs’ long-term growth and we firmly believe that Entain will be the best home for Enlabs, its employees and customers.
“Against this background, we have decided to make a final offer to all shareholders, providing an opportunity to exit their investment at a very attractive valuation.
“We are pleased that shareholders with around 51% have now irrevocably agreed to accept the offer and would urge other shareholders to do the same by 18 March,” he added.
Enlabs’ share price increased by more than 17% on the news.