BlackRock has re-upped its control in Entain, crossing the 5% threshold once again.
The US investment giant acquired another 0.95% of voting rights in the UK-based, LSE-listed gaming multinational yesterday, increasing its control to 5.01%.
It comes despite the fact that it has been a troubling time for Entain, with tax increases in its home market and wider regulatory uncertainty across Europe contributing to growing losses and a reduction in its workforce and share price.
The company has now become the largest gambling operator listed on the LSE, however, following Flutter Entertainment’s delisting at the end of July.
It is also the only gambling company on the FTSE 100 index. Flutter was also a FTSE 100 firm for many years, but exited the index when it made New York its primary listing in 2024.
Entain’s market cap currently sits at £3.55bn, over £2bn higher than its nearest LSE-listed industry counterpart Playtech’s value.
However, its stock has been continuously shrinking in the last five years, having dropped by over £13.75 (71.3%) to £5.54.
The last 12 months have been an arduous period for many operators, particularly in Europe, due to stricter regulations and increasing tax rates.
A tax rise on Remote Gaming Duty (RGD) from 21% to 40% in the UK, announced in November by then-Chancellor of the Exchequer, Rachel Reeves, and implemented in April, was always going to negatively impact Entain’s bottom line.
The firm has begun to implement cost-cutting measures, which includes a recent announcement that it is set to cut around 500 of its workforce.
However, it seems BlackRock is still holding out hope for Entain, though it does have a titanic portfolio, being the largest asset management firm in history with a record-breaking $15.3tn assets under management.
Does BlackRock see an opportunity in Entain?
It comes less than two months after the investment business sold off a portion of its Entain stock in a move which saw its control dip below the 5% mark.
Entain’s share price also took a hit relatively recently, following the release of BetMGM’s Q2 results – an operator in which it holds a 50% stake in.
BetMGM stated its net revenue and adjusted EBITDA is set to come in at the lower end of its respective $2.9-$3.1bn and $300-$350m guidance ranges, which did not fill Entain investors with confidence.
The firm is set to release its Q2 results next week too, and BlackRock may be looking to capitalise on a dip that could come before a potential share price increase as Entain reveals the impact that the earlier stages of the 2026 World Cup had on its revenue.