Could MGM Resorts International (NYSE:MGM) be limbering up for another tilt at Entain PLC (LSE:ENT)?
The question has resurfaced after a series of moves by the US casino group that look, at least on paper, like balance-sheet preparation.
Back in January 2021, MGM tried to buy Entain with an all-share offer worth £13.82 a share, a 22% premium to the closing price at the time.
Entain’s board swiftly rejected the proposal, saying it “significantly undervalued the company”. Since then, investors have kept one eye on whether MGM might return to the table.
Now, there is renewed speculation. On 15 October, MGM scrapped its $2.3 billion bid for a New York casino licence.
A day later, it agreed to sell the operations of MGM Northfield Park in Ohio for $546 million in cash, generating about $420 million in net proceeds. The timing has not gone unnoticed.
Citi analysts suggest these moves could be part of a broader effort to build financial flexibility ahead of a second approach for Entain or its joint venture, BetMGM.
But they add that an all-cash bid looks unlikely without MGM raising substantial new capital, meaning any fresh offer would probably have to be part-funded with shares.
A partial transaction focused solely on BetMGM also appears complex, given MGM’s current liquidity. For now, the market will have to settle for the familiar rumour cycle that has followed both companies since the first bid.
The shares were unmoved by the speculation at 814.6p.