Several days ago, MGM Resorts International was hit by an unprecedented cybersecurity issue, forcing it to shut down multiple computers and temporarily shut down its official website. Believed to be a cyberattack, the issue affected the casino and hospitality giant’s business in multiple states.

Following reports about an earlier cyberattack on Caesars Entertainment, another casino juggernaut, people familiar with the matter claimed that the cyberattack on MGM Resorts had been initiated by the same group.

Sources identified the wrongdoers as the Scattered Spider group, a notorious team of cybercriminals, believed by experts to be comprised of tech-savvy young people. Currently one of the most dangerous hacker groups in the United States, the Scattered Spider group cleverly uses social engineering to get hold of users’ login credentials and OTP codes.

The efficacy of this tactic has resulted in multiple successful cyberattacks, disrupting companies’ business.

MGM Prepares for Material Losses

MGM Resorts earlier admitted that the incident carries a significant material risk to the company. This was reflected in the company’s share price. Currently trading at a price of $41.47 per share, MGM’s stock has been on the decline since the first news of the incident.

In addition, the shutdown of multiple corporate emails, sites and booking systems is likely to incur further losses. Even worse, the shutdowns have caused significant disgruntlement among unhappy MGM Resorts customers who continue to express their worries about their personal data on social media.

Adding to the casino giant’s woes, Moody’s, an influential credit rating agency, noted that the recent attack is likely to affect MGM’s credit rating negatively because of the underlying security weaknesses.  

While MGM refused to comment on Moody’s warning, the company filed an 8-K report to the Securities and Exchange Commission, warning it about the potential impact of the cyberattack.

In the meantime, reports claim that Caesars Entertainment had been hit by a similar breach several days prior to the MGM Resorts incident. According to people familiar with the matter, Caesars had to pay tens of millions of dollars to the wrongdoers in order to secure its business.

Elsewhere, Stake.com, a leader in online and crypto gambling, recently lost millions of dollars in cryptocurrencies following an attack from another cybercrime group. The FBI later identified the attackers as the Lazarus Group, a team of hackers with ties to North Korea.

The post Scattered Spider Behind MGM Attack, Company Prepares for Material Risks appeared first on Keno Wizard.

Acquisition target PointsBet sent a letter to the Australian Securities Exchange (ASX) this morning to request a trading halt of its stock due to a material announcement.

Disclosure Obligations

PointsBet requested the immediate implementation of a trading halt on its securities listed on the ASX to allow it to manage its continuous disclosure obligations in relation to a material transaction as per ASX Listing Rule 17.1.

The Australian-based sports betting operator is at the center of an acquisition tussle between the sports commercial giant with a huge appetite in the sports betting space, Fanatics, and the second-largest in terms of sports wagering market share in the US, DraftKings.

Last month, Fanatics thought they had wrapped up a $150 million deal to acquire the US assets of PointsBet as both sides agreed to the deal under the terms of which Fanatics would pay $100 million upon transaction close and the rest in February 2024. The nascent sportsbook went live in its second US state, Maryland, in early June.

On June 16, Boston-based sports betting and gaming operator DraftKings tabled a 30% higher bid, $195 million, for PointsBet USA and derailed the agreement between PointsBet and Fanatics. A recent media report also suggested that personal motives dating back to a failed merger deal in 2021 may exist behind the risky bid.

Upon receiving the proposal from DraftKings, PointsBet said its previous agreement with Fanatics was inferior and began looking into the new bid. There is one stumbling block in the proposal as it is subject to DraftKings obtaining regulatory approvals while PointsBet insists on a “hell or high water deal” deal.

Trading Halt for One Day

In its letter to the ASX, PointsBet requested that the trading halt remains in place until the company makes its announcement to the market but no later than the commencement of normal trading on June 28, 2023, meaning that trading with PointsBet stock should be suspended for no more than a trading day.

PointsBet concluded its letter by stating that the company “is not aware of any reason why the trading halt request should not be granted, nor of any other information necessary to inform the market about the trading halt.”

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