MGM Resorts International is reportedly in talks to acquire British gaming company Entain. Sources familiar with the negotiations said that MGM had already made a new offer to buy the Ladbrokes owner.

The sources said that the amount offered to Entain was not disclosed but it could be much higher than the company's current market valuation of about $9 billion. In comparison, MGM is currently valued at around $16 billion. Its business includes casinos including its Bellagio and Mirage brands.

Entain previously received a $10 billion offer - with a substantial stock component - that was rejected.

The same sources said that the new offer made by MGM is now being backed by its largest shareholder InterActive Corp. The sources said that there was no guarantee that Entain will be receptive to the new offer or that a deal would be made.

If Entain does take the offer, the combined entity would become one of the largest gaming companies in terms of the number of physical and online gaming options. It would also become one of the largest consolidations in the industry.

Similar to other gaming companies, MGM's business has been under pressure as the pandemic forced it to shut its casinos and hotels. While its business in the U.S. has yet to fully recover, the company has been seeing a slight rebound abroad. The company has experienced an increase in its minor online gaming operations during the crisis which has offset some of its losses.

Analysts said MGM's plan to acquire Entain is part of its strategy to double-down on the rapidly growing online gambling sector. MGM currently derives a small portion of its revenue only from online betting. By acquiring the British company, it would significantly increase its revenue stream.

Entain is one of the UK's largest gambling companies. It increased its presence in the sector after it acquired Ladbrokes in 2018. The company's share price rose last year as the pandemic increased online gambling in the UK and other parts of Europe.