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US casino giant MGM Resorts has made an $11bn (8.1bn) supply for British gaming firm Entain, which owns Ladbrokes.

The move is the most recent effort by a casino operator to maneuver into the online gambling company.

In addition to the series of High Street gaming stores, UK-based Entain also possesses lots of online sports betting and gambling sites.

Entain affirmed the deal, before all else reported by the Wall Street Journal, however said that the cost was too low.

It had recently rebuffed a previous $10bn (7.3bn) all-cash strategy from MGM, ” the paper said.

In a statement,” Entain stated the latest bid strategy"significantly undervalues the company and its prospects".

MGM Resorts, which conducts the Bellagio casino in Las Vegas, now has before the start of next month to choose whether to make an official bidding or to walk off.

FTSE 100-listed Entain. Which renamed itself in GVC Holdings a month, which describes itself as"one of the world’s largest sports betting and gaming groups operating in the online and retail sector".

Along with Ladbrokes, in Addition, It owns Brands like Bwin, Partypoker, Coral, Eurobet, Gala and Foxy Bingo.

After news of the most recent offer for the company, investors began gambling on Entain, pushing its share cost up by over 25 percent to 14.30 a talk – over MGM’s supply of approximately 13.83 per share – a indication that store watchers are anticipating a higher bid.

If the two companies do reach an compliance, it might follow a different bargain in September if MGM rival Caesars Entertainment consented to purchase UK-based William Hill for $3.7bn (2.9bn).

"Following Caesar’s offer for William Hill last year, a bid by MGM for Ladbroke’s owner Entain isn’t just a surprise," said Nicholas Hyett an analyst at Hargreaves Lansdown.

"The two will be working together to take improvement of this current legalisation of sport gambling from the US, a store worth several billions of dollars annually."

Predictions about the stockmarket have a habit of making the person trying to guess the future look foolish. No such problem for Laura Foll, a fund manager at the investment firm Janus Henderson. On the Today programme on Monday, she forecast more takeover offers for household names in Britain, noting that the UK stores remained unloved by investors and so – perhaps – undervalued.

An hour after the prediction a big offer duly landed, with Entain, the London-listed company that owns Ladbrokes and other gambling brands, saying it had received a takeover proposal from MGM Resorts, an American rival.

The US company is offering to pay shareholders in Entain not in cash, but in new MGM stocks – an obvious move given the sky-high rating of US stocks compared to those listed in London.

It looks a carbon copy of last year’s deal where Caesars, best known for its Las Vegas properties, bought another venerable name in British bookmaking, William Hill. Get ready for more acquisitive foreign companies looking for deals in bargain basement London.

Covid headwinds

The new bid for Entain comes with financial backing from MGM’s largest shareholder, InterActiveCorp (IAC), which took a 12% stake in MGM Resorts last August.

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At the time, IAC’s chief executive Barry Diller said it planned to work with MGM to expand its online gambling portfolio.

The attempted acquisition comes as the casino industry faces headwinds from the Covid-19 pandemic.

Bricks-and-mortar casino operators have struggled under travel restrictions.

The economy of Asian casino hub Macau shrank 49% in the before all else quarter of this year, while unemployment in Las Vegas reached 30% earlier in the year and remains well above the US average.

MGM Resorts, which is the operator of the Bellagio casino in Las Vegas, laid off 18,000 furloughed employees in the US in August.

Many online gambling companies, by contrast, saw a boost during Covid-19 restrictions, prompting many casino owners to pivot their businesses towards online.

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