PointsBet (ASX:PBH) calls investors to take a punt on $300M capital raise

• Bookmaker PointsBet (PBH) has locked up its shares as it asks investors to take a punt on a $303 million equity raise
• Shares in the digital sports betting player were locked up yesterday, but should resume trading by Wednesday, September 9
• PointsBet has since confirmed the details of its offer, announcing a $153.2 million fully underwritten accelerated pro-rata entitlement offer and a $150 million institutional placement
• Looking ahead, the sports betting company says the funding will cover marketing costs as PointsBet expands throughout the U.S.
• It’ll also support tech and platform development, as well as the growth of its American operations
• PointsBet last traded for $13.69 per share on Wednesday, September 2

Bookmaker PointsBet (PBH) has locked up its shares as it asks investors to take a punt on a $303 million equity raise.

Shares in the digital sports betting player were frozen yesterday amid the raising, but should resume trading by Wednesday, September 9.

Contrary to other capital raise-related trading halts, PBH has already come out of the gate with details of the raise.

In fact, the consumer discretionary stock alluded to the offer back on Friday, August 29, when it also announced its FY20 results and a five-year partnership with NBC.

PointsBet has confirmed the offer details in full, announcing a fully underwritten accelerated pro-rata entitlement offer to raise $153.2 million and a $150 million institutional placement.

All up, the bookmaker hopes to nab roughly $303 million before costs to support its long term growth strategy.

When it first alluded to the offer late last week, Pointsbet shares were worth $7.50. However, by Friday’s market close, the stock’s value had risen to a whopping $14 per share, boosting the company beyond a $2 billion market cap.

While shares have settled slightly to trade for $13.69 by Wednesday’s close, the company’s current pricing means the one-for-6.5 entitlement offer, priced at $6.50 a pop, is a substantial discount.

Under the entitlement offer, PBH shareholders can also receive one new option, exercisable at $13.00 and expiring on September 30, 2022, at no extra cost.

At present, PointsBet is yet to set a price for its institutional placement — instead, this will be done after the company completes a bookbuild.

That placement will kick off after market close today and close by this Friday, September 4, at which point the price and total proceeds will be disclosed to the market.

Then, the institutional component of the entitlement offer will begin after the weekend, at which point PBH will lodge a prospectus with the ASX.

Looking ahead, the sports betting company says the funding will cover marketing costs as PointsBet expands throughout the U.S. It’ll also support tech and platform development, as well as the growth of its American operations.

PointsBet last traded for $13.69 per share on Wednesday, September 2.