The Pointsbet Holdings Ltd (ASX: PBH) share price is racing higher today.
The All Ordinaries Index (ASX: XAO) sports betting company entered a trading halt just before market open on Tuesday. The company requested the pause in trading pending an update on the proposed takeover of PointsBet by Japanese entertainment company, MIXI Inc (TYO: 2121), via its wholly owned subsidiary, MIXI Australia.
The ASX All Ords stock closed on Monday trading for $1.085, prior to yesterday's trading halt.
With the stock back in action today following the release of that takeover update, the PointsBet share price surged to $1.205 in earlier trade, up 11.1%. After some likely profit taking, shares are currently changing hands for $1.19 apiece, up 9.7%.
Here's what's spurring ASX investor interest today.
PointsBet share price leaps on sweetened proposal
As you may be aware, PointsBet finds itself with not just one, but two suitors who've expressed an interest in acquiring all of its shares. That acquisition interest has helped drive a 44% increase in the PointsBet share price since 25 February.
MIXI was first on the scene, offering to pay $1.06 per share in cash in February. A proposal that management initially accepted.
But on 6 March, Betr Entertainment Ltd (ASX: BBT) threw a spanner into the works. Betr, PointsBet's largest shareholder, offered to acquire all of the PointsBet shares via a scheme of arrangement. The scheme valued PointsBet stock at $1.28 per share.
But the bidding war was far from done.
On 29 April, Betr improved and amended its offer, with a potential value of $1.33 per PointsBet share, via a combination of Betr shares and cash.
Which brings us back to today's announcement sending the PointsBet share price soaring.
Investors are reacting positively to news that the ASX All Ords gambling stock has received an improved proposal from MIXI.
Management said that PointsBet has now entered into a deed of variation with MIXI Australia to vary the original scheme from 25 February. MIXI's new takeover offer ups the ante by 13.2%, from $1.06 per share to $1.20 a share.
The proposal is not subject to financing.
Commenting on the improved deal sending the PointsBet share price soaring today, management noted:
The improved proposal implies an enterprise value of $402 million, an increase in value to PointsBet shareholders of $49 million. It also represents an implied EV/EBITDA multiple of 28.7 to 36.6 based on PointsBet's FY25 EBITDA guidance range.
If shareholders fail to support the current offer (with Betr indicating it is likely to vote no with its shareholdings), MIXI said it would consider proceeding with the acquisition via an off-market takeover bid with a 50.1% minimum acceptance condition.
MIXI said it would then still offer $1.20 a share in cash.
