Background: PointsBet is an Australian online bookmaker launched in 2017. It made a name for itself for raising nearly $500 million to dominate betting overseas, particularly in the US. In 2023, Pointsbet sold its US division to the merch-giant Fanatics for $225 million after it was bleeding money like a rookie at the craps table. On top of this, it was losing between $15 - $30 million per quarter before selling the US business.

‍What happened: After the US sale, Pointsbet promised plans to double down on the Australian and Canadian markets. But now, Pointsbet has announced plans to sell the Australian and Canadian businesses for $350 million to a Japanese-based bookmaker called Mixi.

‍What else: But just after Pointsbet announced the deal, another competitor, BlueBet claimed it also made an offer to acquire the bookmaker. Bluebet claims Pointsbet refused to even engage in its offer that was valued at more than $360 million.

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‍What's the key learning?

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‍💡Board directors always need to act in the best interests of their shareholders. But the big question is what is the "best interest"? It’s not always about who throws the biggest pile of cash on the table - sometimes other strategic factors come into play.

💡In this case, Mixi offered Pointsbet’s board and shareholders ~$350 million in cash money today — that’s cold, hard cash in the bank. This reduces risk and provides immediate cash for shareholders. On the other hand, BlueBet offered Pointsbet a mix of $260 million in cash and up to $120 million in BlueBet shares — a type of deal is known as a cash + scrip offer.

💡But here’s the kicker: the value of those BlueBet shares isn’t guaranteed - it all depends on how BlueBet performs in the future. And, this is a good example of how M&A decisions aren’t just about the headline number, but it’s about managing risk and ensuring shareholder value.