Both Tattersall’s and Tabcorp are bidding to takeover Queensland gambling group UNiTAB, which at present is committed to the proposed deal with the Victoria lottery company, Tattersall’s, made last March. This month’s rival bid from the Victoria gaming giant Tabcorp has been described by the UNiTAB MD as having ‘odious’ conditions attached. Holders of UNiTAB shares are presently being sent a bidder’s statement by Tabcorp.

The Tabcorp bid has so far been rejected by the UNiTAB Board as it is deemed to be too low, lacking a takeover premium. However, shareholders may be persuaded that ultimately Tabcorp shares will prove to be of higher value than those of Tattersall’s, even though its bid offer is lower. UNiTAB must publish a target statement within the next 15 days.

This week UNiTAB has asked its shareholders to take no action on the rival takeover and merger bids and to await further guidance issued by its Board. The company is maintaining that the Tabcorp takeover bid is highly conditional as it requires approval from the Queensland Government and Australia’s Competition and Consumer Commission. Tattersall's chief executive has said that Tabcorp's A$2.1 billion offer for Unitab would disadvantage punters, damage competition and lead to a drop in state governments' tax take. The planned merger with Tattersall’s has previously been recommended by the Board. (E-06.22.06)

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