Two giants in the gaming industry have announced they will join forces to create a “diversified portfolio” of gambling entertainment businesses.
Tabcorp (ASX:TAH) and Tatts Group (ASX:TTS) will merge, and completion is expected by mid-2017 (following Tatts shareholder, regulatory and other approvals).
On completion, Tabcorp shareholders will own 42% of the combined group, while Tatts shareholders will own 58%.
The merger will be effected via a Tatts Scheme of Arrangement. Tatts shareholders will receive 0.8 Tabcorp shares, plus 42.5 cents cash for each Tatts share they hold.
The companies are expecting the combined group to earn revenue of over $5 billion, and EBITDA of over $1 billion.
Tabcorp posted a net profit of $169.7 million at 30 June 2016.