JP Morgan has reported that Tabcorp’s lotteries and Keno businesses may have increased in value by between AU$9.4bn and AU$12.4bn while the value of the wagering and media division may have shrunk.<\/p>\n\n\n\n\n\n\n\n
Australia.- Lottery services provider\u00a0Tabcorp<\/a>‘s decision to demerge its businesses into two separate companies\u00a0could benefit the lotteries and keno division, JP Morgan says.<\/p>\n\n\n\n According to analysts, the lotteries and Keno division may now be worth between AU$9.4bn and AU$12.4bn, while the wagering division has a value of between AU$3.5bn and AU$3.7bn.<\/p>\n\n\n\n JP Morgan estimated EBITDA for the lotteries division at AU$606.4m in 2022. It estimates EBITDA of AU$337m for the wagering division.<\/p>\n\n\n\n The financial services company said: “Tabcorp is levered to declining segments of the wagering industry<\/strong>, such as retail and tote.<\/p>\n\n\n\n “Its exposure to growth segments, such as fixed-odds, online and sport, is shrinking<\/strong>, as corporate bookmakers have garnered the most market share.”<\/p>\n\n\n\n According to Tabcorp, the demerger process is expected to incur between AU$225m to AU$275m<\/strong> in one-off separation costs and nearly around AU$40m to AU$45m in ongoing incremental costs.<\/p>\n\n\n\n The company noted that it will continue working with BetMakers<\/strong> to discuss potential commercial opportunities in international markets.<\/p>\n\n\n\n In May, BetMakers<\/a> made an AU$4bn (US$3.09bn) offer <\/strong>through which Tabcorp would receive AU$1bn in cash and AU$3bn in BetMakers shares<\/strong>.<\/p>\n\n\n\n Apollo Global Management<\/a>\u00a0put\u00a0two offers on the table for Tabcorp<\/strong>, one equalling an offer made by Entain and another offering US$3.10bn including Tabcorp\u2019s gaming services business.<\/p>\n\n\n\n Entain<\/a>, meanwhile, upped its original offer for Tabcorp from AU$3bn to AU$3.5bn. The company expressed its disappointment with Tabcorp\u2019s decision<\/a> to separate in two and argued its offer would have delivered better outcomes for shareholders.<\/p>\n\n\n\n The company board said in a statement: \u201cEntain is disappointed by the decision of the Tabcorp Board, as we believe our all-cash offer would have delivered superior outcomes for shareholders<\/strong>, customers, employees and the wider industry. <\/p>\n\n\n\n \u201cPrice discipline is essential in building on the significant shareholder value that our global growth strategy will deliver for all our stakeholders <\/strong>and we have a healthy pipeline of opportunities.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":" JP Morgan has reported that Tabcorp’s lotteries and Keno businesses may have increased in value by between AU$9.4bn and AU$12.4bn while the value of the wagering and media division may have shrunk.<\/p>\n","protected":false},"author":176,"featured_media":20369,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"is_press_release":false,"is_interview":false,"is_opinion":false,"focusai_summary":"JP Morgan analysis indicates Tabcorp's Lotteries and Keno division's valuation could significantly increase post-demerger, while its Wagering and Media division's value may have contracted due to exposure to declining segments. The demerger, incurring substantial one-off and ongoing costs, proceeded despite multiple M&A bids from entities like BetMakers, Apollo Global Management, and Entain, with Entain expressing disappointment over the decision. This strategic move redefines Tabcorp's market positioning across distinct gaming verticals.","focusai_entities":"JP Morgan, Tabcorp, BetMakers, Apollo Global Management, Entain","focusai_location":"Australia","focusai_target_profile":"ceo_executive (1.0), regulator (0.7), operator_casino (0.9), investor_analyst (1.0), supplier_vendor (0.7), journalist_researcher (0.9)","focusai_suggestions":[{"label":"Demerger Valuation Impact","query":"What are the long-term implications of the re-valuation disparity between Tabcorp's Lotteries & Keno and Wagering & Media divisions on its capital allocation strategy and future growth prospects?"},{"label":"M&A Strategy Post-Demerger","query":"How might the demerger influence future M&A activity for the newly separated Tabcorp entities, particularly given the prior interest from Entain and Apollo Global Management?"}],"footnotes":""},"categories":[16336,157],"tags":[13716],"class_list":["post-20368","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-australasia-news","category-business-news","tag-tabcorp"],"_links":{"self":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts\/20368","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/users\/176"}],"replies":[{"embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/comments?post=20368"}],"version-history":[{"count":3,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts\/20368\/revisions"}],"predecessor-version":[{"id":20413,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts\/20368\/revisions\/20413"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/media\/20369"}],"wp:attachment":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/media?parent=20368"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/categories?post=20368"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/tags?post=20368"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}