PointsBet’s board has made its choice between two high-profile takeover bids.

The company confirmed on Monday that it has formally rejected a takeover proposal from fellow Australian sportsbook operator Betr in favour of an improved offer from Japanese entertainment giant Mixi.

PointsBet leadership had already stated earlier this year that a previous Mixi proposal, representing a value to shareholders of $1.06 AUD per share, was its preferred option ahead of a mixed-funding Betr bid which purported to have a higher total valuation.

After PointsBet subsequently suggested that the Betr bid could in fact represent a superior proposal, Mixi upped its offer to $402 million AUD, which surpassed a rival offer from Betr in both financial valuation and, according to PointsBet’s board, quality.

Last week, the Australian government’s Foreign Investment Review Board (FIRB) approved the mooted Mixi takeover. The deal would still be subject to a 50.1% minimum acceptance from shareholders as well as regulatory approval in Ontario, which is PointsBet’s only international market outside Australia. PointsBet offers online sports betting and online casino in Ontario’s regulated market, the only jurisdiction in which its users can play online casino games.

PointsBet shareholders are scheduled to vote on the MIXI offer on 25 June. Betr owns 19.9% of PointsBet stock and its Chair Matthew Tripp said it intends to vote that entire holding against the Mixi bid.

As well as recommending Mixi’s improved offer ahead of Betr’s, PointsBet’s board has entered into an agreement for the Australian branch of Mixi to complete an off-market takeover should Mixi’s offer not get the requisite approval at the shareholders’ meeting. That scheme, which would require 50.1% shareholder approval, effectively provides a second avenue by which Mixi could take over PointsBet.

Why PointsBet is rejecting Betr

In a statement on Monday, PointsBet wrote that it has unanimously decided to reject the Betr proposal, in part because the valuation of the deal is materially below the improved Mixi offer of $1.20 AUD per share.

PointsBet also determined that the value of the cost synergies identified by Betr has been “materially overstated” and added that there would be significant integration and implementation challenges.

The company also raised concerns around PointsBet’s revenues potentially being cannibalized by a Betr takeover, as a result of “high levels of customer crossover between PointsBet and Betr and expected customer behaviour.”

Betr would have sold some PointsBet Canada assets to Seminole Hard Rock Digital as part of its fundraising to acquire the remaining 80.1% of PointsBet shares. In contrast, Mixi’s 100% takeover would leave PointsBet’s Canadian business intact.

Betr’s assumption that PointsBet’s Canadian business could be carved out in a way that realizes large synergies poses “significant integration and implementation challenges,” added PointsBet.