DraftKings (DKNG.US) stock jumped 6% during today's session after sports betting company scrapped its $22.4 billion takeover bid for British bookmaker Entain (ENT.UK), becoming the second US bidder this year to try and fail to take control of the British owner of Ladbrokes betting shops. The board of Entain, which also owns other brands including Coral, and Bwin, knocked back an £8bn offer from US joint venture partner MGM Resorts in January.
None of the companies explained why the acquisition talks ended, but said in separate statements that they believed strongly in their individual growth prospects. "After several discussions with Entain leadership, DraftKings has decided that it will not make a firm offer for Entain at this time," DraftKings Chief Executive Officer Jason Robins said in a statement. Under UK acquisitions law, DraftKings cannot submit another bid on Entain for six months, unless another entity submits a competing bid. DraftKings made a £ 28-a-share offer for Entain in cash and stocks in September after Entain rejected an earlier £ 25 offer.
DraftKings (DKNG.US) stock has experienced a bigger downward correction recently, however buyers managed to halt declines at an upward trendline. Stock launched today's session with a bullish price gap and is currently testing local resistance at $50.50 which is marked with 38.2% Fibonacci retracement of the upward move launched in March 2020 and previous price reactions. Should a break higher occur, an upward move may accelerate towards next resistance at $55.00 which coincides with 50 SMA (green line) and 200 SMA ( red line). On the other hand, if sellers manage to regain control and break below the aforementioned trendline, then downward move may be extended to the $40.20 handle or even support at $35.40 which coincides with 61.8% Fibonacci retracement. Source: xStation5
