MGM's bid of 1,383 pence a share was a 22% premium to closing price of Entain’s stock on Thursday. Shares of Entain, the owner of brands including Ladbrokes, jumped as much as 27% in London. MGM shares were down slightly in premarket trading Monday.
Entain has told its shareholders to take no action with respect to MGM's offer and has asked the Las Vegas Strip's largest casino operator for "additional information in respect of the strategic rationale for a combination of the two companies."
MGM Resorts' bid for Entain was first reported by The Wall Street Journal on Sunday.
The Journal's report was based on people familiar with the negotiations.
The U.S. casino and entertainment giant's bid included a "substantial stock component," according to the Journal, after the British company rejected an earlier nearly $10 billion offer.
IAC/InterActiveCorp IAC - MGM's largest shareholder - supports the deal, according to the Journal's report.
Entain, which trades on the London Stock Exchange as ENT, bills itself as one of the globe's biggest retail online sports betting and gambling groups. It offers sports betting and casino, poker and bingo online games, and operates brands such as Ladbrokes, Coral, BetMGM, bwin, Sportingbet, Eurobet, partypoker, partycasino, Gala and Foxy Bingo. It was incorporated in 2004 in Luxembourg and was re-domiciled to the Isle of Man in 2010 to increase the after-tax dividend return to shareholders, but then last year, the company relocated its place of management, control and tax residence to the United Kingdom.
In December, it was "rebranded" from GVC Holdings to Entain to reflect its "ambition to be the world-leader in sports betting and gaming entertainment," reads the company's website, noting that it's now licensed and operates in over 20 nations.
Entertainment company MGM operates hotels and casinos in the U.S. and Macau.
This story has been clarified to reflect Entain's relocation to the U.K. in 2020.