The Tabcorp (ASX:TAH) share price is flat following ASX announcement

Tabcorp's share price is up slightly following an ASX announcement on the retail shortfall bookbuild of its entitlement offer.

Bernd Struben

Author bio Bernd Struben earned his BA in economics from the University of Michigan in 1991, with post-graduate studies in environmental economics at the University of Connecticut. Over the years he’s written about and analysed the tourism industry in the Caribbean; Europe’s commercial real estate markets; and, since moving to Australia in 2010, global and Aussie share markets. Bernd studies geopolitical and macroeconomic trends, alongside sector and company specific data, to gauge what he believes could be tomorrow's best investments. In his free time, you might find Bernd at the beach with his family or working on his next science fiction novel. Areas of expertise Australian and global share markets Macroeconomic and geopolitical trends Real estate Education Economics, University of Michigan Favorite investment quote "The four most dangerous words in investing are: 'This time it's different." — Sir John Templeton

Published September 16, 2020 1:53 pm AEST

Tabcorp Holdings Limited (ASX: TAH) is up slightly in early afternoon trading after the company announced it had completed the retail shortfall bookbuild of its entitlement offer.

The ASX released the announcement at 11.15 this morning. Since that time Tabcorp's share price has gained 0.9%.

The gambling and entertainment company got walloped by the COVID-19 driven panic selling earlier this year, seeing its share price fall 53% from 14 February through 23 March.

Since that low, Tabcorp's share price has come surging back, up 57%. But that hasn't been enough to recover its earlier losses, as a 50% loss requires a 100% gain to break even.

Year-to-date Tabcorp's share price is down 25%.

man placing sports bet on mobile phone and laptop, sports betting, pointsbet share price — Source: Getty Images

What does Tabcorp do?

Tabcorp Holdings is a diversified gambling entertainment group. The company is the largest provider of lotteries, Keno, wagering and gaming products and services in Australia.

Tabcorp's portfolio includes numerous big brand names such as TAB, Keno, The Lott, George, Max, TGS, eBET and Sky Racing. It has four operating segments: Wagering and Media, Lotteries and Keno, Gaming Services, and Sun Bets.

Tabcorp first publicly listed in 1994. Today it has a market cap of $7.3 billion and is part of the S&P/ASX 200 Index (ASX: XJO).

What did Tabcorp announce to the ASX?

This morning Tabcorp announced it had completed the retail shortfall bookbuild of its renounceable entitlement offer. This is the final stage of the company's entitlement offer.

The original retail entitlement offer saw 71 million new shares issued at $3.25 per share, raising approximately $230 million. Combined with the institutional component of Tabcorp's entitlement offer, which closed on 21 August, the company announced it has raised approximately $600 million. This will be used to pay down debt and strengthen Tabcorp's balance sheet.

Last night after market close, 39.7 million retail entitlements were offered as part of the bookbuild, for $3.31 per retail entitlement.

Addressing the completion of the bookbuild, Tabcorp chair Paula Dwyer said:

The completion of the retail shortfall bookbuild concludes the renounceable entitlement offer announced with our FY20 results. We are pleased that all of our retail shareholders who did not participate have realised value for their rights.

Tabcorp is currently trading at $3.41 per share.

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