(HedgeCo.Net) The activist hedge fund Sachem Head Capital Management is making a bold claim: shares of U.K.-based sports betting group Entain?PLC could double over the next few years, thanks largely to its joint venture with MGM?Resorts?International that operates under the brand BetMGM. Reuters
Speaking at a New York conference, founder Scott?Ferguson stated: “Time is on your side … you are getting paid to wait for BetMGM to inflect.” Reuters He noted that Entain is one of four activist-driven investors involved (including others like Corvex?Management and Eminence?Capital) that may push for strategic moves such as Entain buying out BetMGM, merging with MGM, or MGM acquiring the JV outright. Reuters
Entain’s shares closed at around £10.88 (?$14 at current rates) and Ferguson sees upside to around £27 by 2028 — a potential 2× gain. Reuters He points to multiple tailwinds: expanding legalization of sports betting in the U.S., improved marketing discipline from BetMGM (less extravagant Super Bowl ads, more ROI-focused spending), and the latent value of the JV being under-priced.
For hedge-fund watchers, this case ticks many boxes: a value-oriented activist entry, a high-growth regulated theme (sports betting), and potential strategic leverage (corporate restructuring). The risk, however: regulatory changes (e.g., taxation or gambling laws), slower legalization roll-out in U.S. states, or operational mis-execution by BetMGM.
From a broader market perspective, the story also highlights the growing role of activist hedge funds in non-traditional sectors (gambling & entertainment) and the rising appetite for regulated “growth” businesses in alternative strategies.
What to watch:
- The next regulatory approval in a major U.S. state for BetMGM operations.
- Any public signal from Entain or MGM that they are exploring one of the strategic options (buy-out, merger).
- Betting revenue growth and user-acquisition metrics from BetMGM.
- Performance of other activist stakes in regulated entertainment/sports sectors.
In summary, for investors and market watchers, the saga of Entain and BetMGM presents a concrete activist hedge-fund play with defined upside and identifiable catalysts. While not without risk, the doubling thesis is clearly laid-out by the activist camp.