MGM Makes an Offer to Acquire Sweden’s LeoVegas for $607 Million

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MGM has been looking to expand into the global online betting market. So, a move in that direction is to acquire an internationally operating betting company. And, it looks like MGM has found the company of its choice.

Last quarter, the CEO of MGM, Bill Hornbuckle indicated that the company was looking into making an international acquisition. At the time, many in the industry assumed this meant the company would make another play to purchase current BetMGM partner Entain. However, this is not the case.

A few days ago, MGM made an offer to buy LeoVegas, a gaming operator from Sweden. The offer from MGM is for a cool $607 million.

LeoVegas is based out of Stockholm. The company has made a name for itself with its online casino product in addition to its Kambi-powered sportsbook. At this time, the company is licensed to operate in eight jurisdictions, which are located in Europe, mostly in the Nordics.

It also receives around 25% of its revenue from markets from the .com world, which includes Latin America.

MGM has a few reasons behind this acquisition plan. The company is looking to expand its business and reach on a global scale. It also wants to cultivate a strong management team for online gaming as well as casino tech stack. This includes wallet and player account management (PAM). And, by purchasing an already established international company, the company is hoping to be able to add to its revenue stream in a more immediate way.

It looks like the offer from MGM is likely to be accepted by LeoVegas. The board of the company has recommended the offer to its shareholders. And, the founder and largest shareholder of the company, Gustaf Hagman, has indicated his support for the deal.

According to MGM, if accepted, the acquisition could be completed in the second half of 2022.

Some in the gaming world do not think MGM has fully revealed its rationale behind the purchase. It has been suggested that this deal is a result of BetMGM hoping to end its current partnership with international operator Entain. If MGM owns LeoVegas, the company will be in direct competition with Entain in markets outside of the United States.

However, LeoVegas does not have Entain’s strength when it comes to sports betting as well as poker. But, because it does not appear that MGM and Entain’s goals are quite so aligned, this purchase could be the first step in an interesting strategy from MGM. Cutting Entain from the equation could be the best course of action for MGM’s future, depending on their plan.

Written by Allie Nelson, our US Sports Betting Industry Expert.