DraftKings ends takeover talks with Ladbrokes Coral owner Entain

US gambling operator DraftKings has pulled out of its proposed $22.4 billion (£16.4bn) takeover of Entain, the parent company of Ladbrokes and Coral.

Entain rejected a $20bn offer from DraftKings in September and the new offer had been under consideration.

Under City rules DraftKings had until 5pm on October 19 to confirm whether it intended to make an offer, but Entain announced last week that an extension had been granted until November 16 as talks continued. However, a statement released by DraftKings on Tuesday morning confirmed talks between the two parties had ended.

DraftKings chief executive, co-founder and chairman Jason Robins said: “After several discussions with Entain leadership, DraftKings has decided that it will not make a firm offer for Entain at this time.

"Based on our vertically integrated technology stack, best-in-class product and technology capabilities and leading brand, we are highly confident in our ability to maintain a leadership position and achieve our long-term growth plans in the rapidly growing North America market.”

Responding to the news, Entain's board said it remains focused on executing its growth and sustainability strategy.

A statement released on Tuesday read: "The board strongly believes in the future prospects of Entain, underpinned by its leading market positions, world class management team and industry-leading proprietary technology. Entain has an outstanding track record of growth having delivered 23 consecutive quarters of double digit online NGR growth."

David Brohan, gaming and leisure analyst for stockbrokers Goodbody, said the announcement did not come as a surprise given the level of complexity around the deal.

He added: "Getting approval from MGM and structuring an arrangement around the technology platform, along with any deal having a sufficient cash element to gain shareholder approval likely culminated in difficult discussions for the two parties.

"The key question now will be whether MGM decides to make a bid, either for the 50 per cent of the BetMGM that it doesn’t own or for Entain outright."

Earlier this year, Entain rejected an $11bn takeover bidfrom US casino giant MGM, saying the bid had "significantly" undervalued the company.

Shares in Entain fell 6.32 per cent on Tuesday to close at 2,002p.

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