PointsBet’s Acquisition by MIXI Faces Regulatory and Shareholder Approval Hurdles
PointsBet Holdings has formalised a conditional takeover bid deed with MIXI at $1.20 per share, activating if shareholders reject the current scheme of arrangement. The deal hinges on key regulatory approvals and a minimum 50.1% acceptance threshold.
- Bid Implementation Deed signed between PointsBet and MIXI for $1.20 per share
- Takeover bid triggered if scheme of arrangement fails shareholder approval
- Minimum 50.1% acceptance condition and regulatory approvals required
- PointsBet Board unanimously recommends scheme, but backs takeover bid if scheme rejected
- Break fees of approximately $4 million payable by PointsBet and $2.5 million by MIXI
Background to the Deal
PointsBet Holdings Limited (ASX, PBH) has taken a significant step in its acquisition process by entering into a Bid Implementation Deed (BID) with Japanese technology company MIXI, Inc. This agreement outlines MIXI’s commitment to launch an off-market takeover bid at $1.20 cash per PointsBet share, but only if the currently proposed scheme of arrangement fails to secure shareholder approval.
The scheme, which was announced earlier in June, proposes MIXI’s acquisition of 100% of PointsBet’s issued capital. The BID acts as a fallback mechanism, ensuring MIXI’s acquisition attempt continues even if the scheme is rejected at the upcoming shareholder meeting scheduled for 25 June 2025.
Key Terms and Conditions
The takeover bid under the BID requires a minimum acceptance of 50.1% on a fully diluted basis, reflecting MIXI’s need to secure majority control. It is also subject to several regulatory approvals, notably from the Australian Foreign Investment Review Board (FIRB) and the Alcohol and Gaming Commission of Ontario (AGCO), given PointsBet’s operations in Australia and Canada.
Importantly, MIXI has already received FIRB approval for the scheme, but must seek a fresh approval if the takeover bid proceeds. The BID also includes customary exclusivity provisions such as no-shop and no-talk clauses, limiting PointsBet’s ability to entertain competing proposals during the exclusivity period.
Board Endorsement and Shareholder Implications
The PointsBet Board continues to unanimously recommend shareholders vote in favour of the scheme, citing the absence of a superior proposal and the Independent Expert’s positive assessment. However, if the scheme is not approved, the Board has agreed to recommend acceptance of MIXI’s takeover bid, again subject to no better offer emerging.
Directors have committed to vote their own shares in favour of the scheme and, if necessary, accept the takeover bid within 10 business days of its announcement. This dual recommendation strategy provides shareholders with a clear endorsement of MIXI’s offer, whether via scheme or takeover bid.
Financial and Legal Safeguards
The BID includes break fee provisions designed to compensate the respective parties should the deal not proceed under certain conditions. PointsBet would owe MIXI approximately $4 million if it withdraws support or breaches exclusivity obligations, while MIXI would owe PointsBet up to $2.5 million under reciprocal circumstances.
Both parties have made extensive representations and warranties, covering corporate authority, compliance, and the absence of material adverse changes. These legal safeguards aim to protect shareholders and ensure transparency throughout the transaction process.
Next Steps and Market Watch
PointsBet plans to issue a supplementary scheme booklet before the shareholder meeting, providing further details on the scheme, the takeover bid, and any developments. Shareholders will vote on the scheme as originally proposed but with amendments reflecting the improved consideration announced earlier.
Market participants will be closely watching the shareholder vote outcome, regulatory approval progress, and any potential competing proposals. The conditional nature of the takeover bid means the final acquisition path remains contingent on these factors.
Bottom Line?
The unfolding shareholder vote and regulatory clearances will decisively shape PointsBet’s ownership future and market positioning.
Questions in the middle?
- Will PointsBet shareholders approve the scheme or trigger the takeover bid fallback?
- How will regulatory bodies in Australia and Ontario influence the timing and conditions of the acquisition?
- Could a competing proposal emerge despite exclusivity clauses, potentially disrupting the deal?
