Pointsbet Mixi Takeover Halted over Vote Counting Error
PointsBet has announced that a recount of votes from its recent shareholder meeting has overturned the original result approving the proposed takeover by Japanese entertainment group Mixi. The change follows the inclusion of votes from Betr, which had initially been excluded due to what was later identified as a system error.
LISTEN TO THIS ARTICLE:Originally, PointsBet reported that 95.69% of votes were in favor of the Mixi acquisition, while 4.31% opposed the move. These figures were based on the assumption that Betr's voting rights had been revoked.
Related: Betr Increases Offer to Acquire PointsBet to $360MIt has since been revealed that a senior officer at Betr had logged into the voting system and canceled the company's votes, but Computershare, the meeting's vote registrar, confirmed that this action was the result of a system error and not an authorized revocation.
Once Betr's votes were reinstated, the revised vote count showed 70.48% in favor and 29.52% against the takeover bid. This result falls short of the 75% threshold required to approve such transactions under PointsBet's corporate governance rules, effectively halting the Mixi acquisition process.
The vote discrepancy prompted immediate scrutiny. Betr formally demanded a recount with its votes restored, resulting in the updated tally that changed the outcome. The error was attributed to a technical malfunction rather than any deliberate action by a company executive, and no disciplinary measures have been reported regarding the voting process.
Despite the rejection of its initial proposal, Mixi has responded swiftly by launching a fresh off-market takeover offer. The new bid consists of an all-cash offer of $1.20 per PointsBet share. The proposal values the Australian sports betting and wagering operator at approximately $402 million.
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Takeover Sends Shares Soaring
PointsBet's shares opened trading at $1.18 following the announcement, a near-yearly high for the company. Prior to the original takeover proposals, the stock had been trading at $0.83, highlighting the market's reaction to recent acquisition interest.
The latest offer from Mixi is being positioned as a more straightforward alternative compared to Betr's all-scrip proposal. According to PointsBet, the all-cash structure reduces the level of uncertainty for shareholders, particularly in light of the complications experienced during the voting process on the previous bid. The company's board has expressed unanimous support for the revised Mixi proposal and is recommending that shareholders accept the offer.
Under the terms of the new offer, Mixi will need to secure approval from at least 50.1% of shareholders for the acquisition to proceed. This is significantly lower than the three-quarter majority required under the earlier scheme of arrangement, simplifying the path to completion. The board's recommendation is expected to carry weight with shareholders, especially after the procedural complications and the higher per-share valuation offered in the revised bid.
PointsBet has not announced a new meeting date regarding the off-market takeover, but the company is expected to begin formal communications with shareholders regarding the offer's terms and expected timeline.
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