MGM Received Government Clearance to Acquire LeoVegas

Despite a $1.6 million fine in the UK & an insider trading probe in Sweden, MGM still wants to buy LeoVegas. It has until Aug. 30 to decide on the $607M offer.
MGM Received Government Clearance to Acquire LeoVegas
By
August 24, 2022

We invested in our international digital future with the announced LeoVegas transaction. MGM Resorts International said it has received the necessary government clearances to acquire LeoVegas AB and is currently waiting for the Sweden-based company to either accept or reject its offer, valued at approximately $607 million.

Last week, MGM said its wholly-owned indirect subsidiary, MGM Casino Next Lion LLC, “has received all relevant approvals. Therefore, the condition regarding the receipt of all necessary regulatory, governmental or similar clearances, approvals, and decisions is fulfilled.”

The proposed acquisition was announced in May.

LeoVegas now has until August 30 to decide whether to accept the all-cash offer, which equates to a price of 61 Swedish kronor (KR) per share. MGM’s offer represents a premium of 44%.

If the deal is completed, MGM said it would begin buying shares of LeoVegas on or around September 7.

$25 no deposit credits + $1000 match bonus
$25 Free Cash
no deposit required
& $1000 match bonus
Last verified: Dec 2022
  • Generous welcome bonus
  • $25 in no deposit funds
  • Good selection of slots

Alleged Insider Trading Didn’t Torpedo Deal

While the deal appears to be moving forward, it could have been derailed shortly after it started.

In June, authorities in Sweden raided LeoVegas’ headquarters in Stockholm as part of an investigation by the Swedish Economic Crime Authority (SECA) into alleged insider trading involving MGM’s offer.

LeoVegas said it is cooperating with the probe. Meanwhile, the SECA hasn’t provided any updates on the investigation, and a search of its database for “LeoVegas” has no results.

If any criminal charges are brought, they would likely be filed in Stockholm District Court. But a search for “LeoVegas” with the court also yielded no results.

For their part, MGM executives don’t seem to be fazed by the scandal.

“We invested in our international digital future with the announced LeoVegas transaction,” Jonathan Halkyard, CFO for MGM, said during an August 3 earnings call to discuss Q2 2022.

Like Entain, LeoVegas Draws UK Fine

This case is a further example of operators failing to protect customers and failing to be [aware of] money laundering risks within their business. In an odd coincidence, the UK Gambling Commission (UKGC) announced on August 3 that LeoVegas had agreed to pay a fine of £1.32 million ($1.6 million) for alleged social responsibility and anti-money laundering (AML) failures.

The regulator said LeoVegas would receive an official warning and be subject to an audit to ensure the operator follows the UK’s social responsibility and AML policies.

“This case is a further example of operators failing to protect customers and failing to be [aware of] money laundering risks within their business,” said Leanne Oxley, UKGC’s director of enforcement.

The fine levied against LeoVegas precisely two weeks before the UKGC cited Entain — MGM’s 50-50 joint venture partner in BetMGM — for similar alleged social responsibility and AML failures. The regulator fined Entain a record £17 million ($20.5 million).

Hornbuckle: MGM Ready to “Learn a Lot” From LeoVegas

LeoVegas has a talented management team, a cloud- & mobile-based technology platform, & an appreciable growth plan that we’ll execute on as we develop our digital gaming presence in Europe. That said, MGM executives didn’t appear fazed by the UKGC’s allegations against LeoVegas, either — although MGM’s earnings call took place on the same day as the announcement by the UK regulator.

“LeoVegas has a talented management team, a cloud- and mobile-based technology platform, and an appreciable growth plan that we’ll execute on as we develop our digital gaming presence in Europe,” MGM CEO Bill Hornbuckle said during the August 3 call.

“We just like the exposure it gives us. It’s a learning curve for us to understand the Rest of the World, and we think we’ll learn a lot from these guys.”

LeoVegas holds gaming licenses in Denmark, Italy, Malta, Spain, Sweden, and the UK. It also has a sports betting license in Ireland. The company is licensed for online casino gaming and sports betting in the German federal state of Schleswig-Holstein.

LeoVegas AB’s two brands — LeoVegas and Royal Panda — are also licensed in Ontario.

Learn more about BetMGM Casino US or head to our complete guide to the Best Online Casinos in the US

Keep reading: