Tabcorp Agrees $0.24-a-Share Scheme Deal for BetMakers

Tabcorp Holdings Limited announced that it has entered into a binding Scheme Implementation Deed to acquire 100% of the issued shares in BetMakers Technology Group (ASX: BET) by way of a scheme of arrangement, for cash consideration of $0.24 per share. Tabcorp said the consideration implies an equity value of approximately $283 million on a fully diluted basis and an enterprise value of approximately $267 million, a multiple of 6.1x enterprise value to BetMakers' pro forma EBITDA for the last twelve months to June 2026 including full run-rate cost synergies, which the company footnotes as based on BetMakers' reported unaudited EBITDA of $14.0 million for the twelve months to 30 June 2026, and a premium of approximately 41%, 42% and 37% to BetMakers' one-month, three-month and six-month volume weighted average prices respectively. BetMakers shareholders may elect to receive a portion of their consideration in Tabcorp shares in lieu of cash, subject to an aggregate cap of 25% of total transaction consideration, with scrip priced at the greater of $1.00 per share, a 12% premium to Tabcorp's 7 August 2026 close, and Tabcorp's five-day volume weighted average price before the scheme record date. A maximum of 70.7 million Tabcorp shares, or 3.1% of shares on issue, could be issued based on a $1.00 issue price.

Tabcorp said it is targeting a run-rate of $30 million of net operating cost synergies before tax by the end of the second year of ownership, which it expects to be driven by operational efficiencies and technology cost savings primarily within Tabcorp's addressable cost base, including rationalisation of data centres, corporate applications and technology contracts, simplification of product-development workflow including replacement of existing Tabcorp technology platforms with BetMakers solutions, and efficiencies across corporate and support functions. The transaction is expected to be EPS accretive from Year 2 and double-digit EPS accretive from Year 3, and pro forma leverage was stated at approximately 1.9x net debt to EBITDA as at 31 December 2025, calculated on Tabcorp and BetMakers adjusted EBITDA for the twelve months to that date, assuming 25% scrip take-up and excluding synergies, against a target range of less than 2.5x through the cycle, with the cash consideration to be funded from existing cash and/or undrawn debt facilities. Completion is subject to approvals from BetMakers shareholders and the court, clearance from the ACCC under Australia's mandatory merger control regime, consents from gaming and racing authorities in jurisdictions where BetMakers operates, and other conditions including no material adverse change. The BetMakers Board unanimously recommends the transaction in the absence of a superior proposal and subject to an independent expert concluding, and continuing to conclude, that it is in the best interests of BetMakers shareholders. Break fees of $2.83 million are payable by either party in certain circumstances, and the parties are targeting implementation during 3Q FY27.