Dodge & Cox Doubles Its Holding in Entain

The US mutual fund company Dodge & Cox has significantly increased its investment in Entain, raising its holding from 5.01% to 10.33% of the total shares in the company. This move has positioned Dodge & Cox as the second-highest single shareholder in Entain, with a total of 66,001,318 voting rights in the Ladbrokes owner.

Capital Group Companies remains the only entity with a larger holding in Entain, currently holding 14.81% of the company. Dodge & Cox initially acquired shares in Entain in September 2022 and also has investments in pharma giant GSK and Google’s parent company, Alphabet. The San Francisco-based firm had $323 billion in assets under management as of December 2022.

Following the announcement of Dodge & Cox’s increased holding, Entain’s shares closed up 0.11% at £954 (€1,099/$1,175) on November 6th.

Entain’s Positive Q3 Results and Long-Term Plans

This development coincided with Entain’s Q3 business update, which showcased a 7% increase in net gaming revenue across all business segments. Online revenue grew by 9%, driven by increases in both sports and gaming revenue, while retail revenue climbed 4% across various international markets.

The company’s US joint venture with MGM Resorts, BetMGM, also experienced an 8% increase in net gaming revenue, totaling approximately $458 million. Entain also revealed key initiatives to enhance its operational strategy, including a focus on high-growth markets such as the US, Brazil, Central and Eastern Europe, and New Zealand.

Entain’s long-term plans include Project Romer, aimed at reaching an online EBITDA margin of 28% by 2026 and 30% by 2028. To achieve this, the company plans to streamline its operations to drive cost efficiencies and improve governance by appointing new non-executive directors.

Entain’s M&A Focus and Recent Acquisitions

Furthermore, Entain has set its sights on mergers and acquisitions, evidenced by its recent STS acquisition and partnerships with sports modelling, forecasting, and analytics specialists. The company has also made significant acquisitions, including SuperSport in Croatia and esports betting developer Sportsflare, as part of its efforts to expand its betting products optimized for esports.

However, Entain has also announced plans to scale back its B2C operations at the Unikrn esports betting arm as part of a repositioning of its esports offering. Overall, the company’s increased investment from Dodge & Cox, positive Q3 results, and strategic long-term plans signal a promising future for Entain in the global gaming and betting industry.

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