Tabcorp and Tatts Group end $9bn merger talks
Discussions to create an Australian online wagering powerhouse terminated after failing to agree "mutually acceptable terms"
Australian operators Tabcorp and Tatts Group today announced talks over a AU$9bn (£4.2bn) merger had come to an end after the two companies were unable to agree “mutually acceptable terms”.
The operators were believed to be in advanced discussions to create a new Australian wagering powerhouse designed to take on some of the large-scale foreign-owned operators including Sportsbet and William Hill.
“There are no further discussions taking place between the parties relating to a merger or any other form of corporate transaction,” Tabcorp said in a statement this morning.
According to local media reports, a sharp drop in Tabcorp’s share price over the last few weeks had scuppered the deal after providing Tatts with a stronger hand in merger talks.
Since the end of October Tabcorp’s share price has fallen from $4.97 to $4.39, its lowest since January, and saw a large sell-off of shares following its trading update on 29 October.
In its most recent financial results, Tabcorp reported a 13% rise in Q1 turnover from its online wagering business after the firm completed the transition onto its new web platform.
The Melbourne-based wagering giant recorded total digital turnover of AU$900.3m (£418m) during the three-month period ended 30 September, up from $796.3m (£369.7m) in the corresponding period last year.
Tabcorp’s and Tatts Group’s share prices were $4.39, down 0.7%, and $4.05, up 3.3%, respectively on the Australian Securities Exchange at the time of writing.