Entain PLC (LSE:ENT) shares tumbled after the boss of MGM ruled out a bid for the owner of Ladbrokes and Gala Bingo.
The FTSE 100-listed gambling group and MGM Resorts International (NSX:MGM) currently are in partnership, operating a US joint venture BetMGM.
On a call following the release of fourth quarter earnings MGM Resorts CEO and president, Bill Hornbuckle ruled out a move for Entain.
“I think it’s time to be definitive and give a little direction. The simple answer on Entain is 'no', we’ve moved on.”
“I said before that we liked their technology platform and their leadership team. We’re also interested in the content studio business. We think there’s a real play there.”
But he added: “So for now, the answer is no, not with Entain.”
In January 2021, Entain turned down a takeover approach from MGM worth 1,383p per share at the time or around £8.1bn, arguing the price was too low, before the shares climbed to above 2200p later that year after another US group, Draftkings, proposed a bid of over £14bn before it later also withdrew.
Entain shares fell 10% to 1,410.5p on Thursday morning.
Analysts at Jefferies said they see "a short-term negative" share price reaction for Entain "given the prolonged period of discussion about the possibility of an MGM / Entain combination" but a "still-attractive valuation should support Entain shares".
"Recent Entain trading was robust (here) and we see the tipping point of US profitability in FY23E as a key catalyst for investor engagement, with Entain benefitting via its 50% stake in BetMGM. "