Sportingbet rejects £350m approach

Sportingbet logoAnna Gowthorpe/PA Wire/Press Association Images

A £350 million takeover proposal from Britain's biggest bookmaker William Hill has failed to win the backing of bid target Sportingbet.

The online gaming firm said the approach from William Hill, which has teamed up with European gaming company GVC for the deal, significantly undervalued the company and its prospects.
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The Daily Telegraph reported that William Hill's boss Ralph Topping was expected to return with a revised offer which could value Sportingbet at more than £400 million.

The earlier proposed bid from William Hill was priced at 52.5p a share, with 7.5p of the offer being in shares in GVC.

Sportingbet, which was previously a bid target for bookmaker Ladbrokes, has seen its shares surge about 16% since speculation over the talks was confirmed.

It is thought any possible offer would be structured so that William Hill would acquire the Australian and certain other locally licensed businesses of Sportingbet, while GVC would acquire the remaining parts of the business.

William Hill and GVC must make a firm intention to make an offer by October 16. It is not clear if the suitors will make a higher offer, given that shares have already been boosted considerably by bid hopes.

Sportingbet is forecast by Edison Research to report profits of £34.5 million, down £3 million on a year earlier but with expectations that the performance will improve in the current year on the back of strong Australian trading. Guernsey-based Sportingbet was founded in 1997 and has more than 2.5 million registered customers in 200 countries who place more than one million bets per day.

William Hill accounts for about a quarter of the UK market, with roughly 2,300 betting shops.

© 2012 Press Association
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