BetMGM, the joint venture between MGM Resorts International and Entain Plc, may not remain a permanent partnership, suggests Entain CEO Jette Nygaard-Andersen. Structured so far as an even 50-50 split between the two global entertainment giants, Nygaard-Andersen hinted at a potential future alteration of the deal at the recent Global Gaming Expo (G2E) in Las Vegas.
The panel discussion, where she made these comments, also featured MGM CEO Bill Hornbuckle and Churchill Downs CEO William Carstanjen, moderated by CNBC’s Contessa Brewer. Although the equal representation in BetMGM from both partners is expected to persist in the near term, Nygaard-Andersen indicated that change could be on the horizon for the iGaming and online sportsbook operator’s ownership structure. “Joint ventures don’t last forever,” Entain’s CEO remarked.
According to Nygaard-Andersen, no specific timeline or form that this transformation might take was disclosed. However, her comments have activated speculation within the business sector, particularly as they were shared less than three weeks following Entain’s muted third-quarter earnings projection.
MGM Resorts has previously shown interest in managing BetMGM entirely, a fact publicized by Bill Hornbuckle. Consequently, some investors speculate that Entain’s recent financial uncertainties might provide a window for MGM to propose another takeover of its BetMGM counterpart.
Recall that earlier in 2021, Entain rejected an $11.06 billion takeover bid from MGM, deeming it insufficient. Meanwhile, Hornbuckle has repeatedly informed analysts and investors that MGM will not rebid for Entain. Currently, as per closing US market valuations, Entain stands at a market capitalization of $7.21 billion.
During the G2E discussion, Hornbuckle acknowledged the leading presence of FanDuel and DraftKings in the US sports betting market. Yet, he expressed that BetMGM was strategizing a unified app wallet solution to bolster seamless navigation for users across operational states.
Hornbuckle also confirmed that MGM had successfully thwarted last month’s ransomware attack without inclining towards extortion. The resultant $100 million reduction in third-quarter profits is planned to be covered through insurance. Furthermore, he expressed optimism over preventing a labor strike in Las Vegas and shared plans to replant trees at the Bellagio before the upcoming Las Vegas Grand Prix.