The private equity group Pacific Consortium has made a new cash bid for Tatts group valued at A.2 billion.
In 2016, Tatts Group rejected a cash-and-shares offer from the consortium that valued the group at A$3.40 per share cash for the lotteries business and shares in a spinoff wagering company the consortium values at A$1 to A$1.60 a share, according to Asian Gaming Brief.
Tatts Group said in rejecting that bid that Pacific Consortium’s bid was not superior to a proposed merger with Tabcorp. According to agb.com, Tatts Group says it is comparing the consortium’s new bid with the Tabcorp offer in last year in regulatory filings.
Tabcorp had agreed to acquire the group for $A11.3 billion, or $8.7 billion, that would create an Australian gambling giant.
“At this time, shareholders do not need to take any action in response to the revised indicative proposal and should not assume that the revised indicative proposal will result in an offer or transaction,” Tatts said in a press statement.
Tatts Group shareholder Sandon Capital—which has argued that the Tabcorp bid undervalues the company—said the new bid will pressure the Tatts board to open its books to the Pacific Consortium in the absence of a higher offer, according the Australian Financial Review.
“This looks like it is clearly designed to get the board to give them due diligence. We now have the beginning of a bidding war,” Sandon’s managing director, Gabriel Radzyminski told the paper.
In a related matter, Tabcorp has agreed to divest its Queensland electronic gaming machine monitoring business, Odyssey, as part of securing competition approvals for the proposed merger with Tatts Group.
In a filing to the Australian Stock Exchange, the group announced it has executed agreements with Australian National Hotels Pty Ltd, a subsidiary of the Federal Group for the divestment.
