DraftKings Tuesday confirmed that, following further analysis and discussions with the Entain board of directors, it will not make a firm offer for Entain.

“After several discussions with Entain leadership, DraftKings has decided that it will not make a firm offer for Entain at this time. Based on our vertically-integrated technology stack, best-in-class product and technology capabilities and leading brand, we are highly confident in our ability to maintain a leadership position and achieve our long-term growth plans in the rapidly growing North America market,” said Jason Robins DraftKings CEO, Co-Founder and Chairman of the Board.

“We are not surprised by this outcome, because we viewed this deal as just too complicated to close from the start given (1) approval rights by its domestic OSB/iCasino joint venture partner, [BetMGM] (2) technology sharing challenges between Entain and [BetMGM] in the event of consolidation, and (3) the sizable amount of equity that would have been used by DraftKings in a ~$22B deal with 78% of this in newly issued equity,” said Joseph Greff, analyst with JP Morgan.

On September 22, Entain received an offered from DraftKings for 2,800 pence a share, a 46% premium over the stock’s closing price. At the time, DraftKings cited the potential for expansion into new markets, acceleration in product growth, and innovation in new and existing verticals as reasons to pursue Entain.

“What remains unanswered to us, at least, is why DraftKings launched this in the first place knowing the complications associated with closing a deal,” added Greff. “DraftKings reports 3Q21 results next Friday, and we expect some clarity on this topic.”

Analysts with Jefferies stated “the pursuit does, however, leave lingering questions on DraftKings’ comfort with its technology resources and the strategic reasons for its interest in Entain.”

Two hours into NYSE trading, shares of DraftKings were up 6.9% to $50.05. At the same time across the pond, Entain is currently down 5.6% to $27.67 in London trading.

Due to the takeover rule in the United Kingdom, DraftKings cannot make another offer for Entain for at least 6 months.

Earlier this year, Entain rejected an $11 billion takeover attempt from MGM, saying the bid undervalued the company during rising interest in online betting. Jefferies Research maintains its position the MGM is the most logical buyer for Entain due to its existing relationship through BetMGM, which complicates a sale by any other party, and its robust capital resources.