Ladbrokes in `Preliminary' Talks With 888; Telegraph Reports 70p/Share Bid
Ladbrokes Plc, the U.K. bookmaker founded in 1886, said it was in “very preliminary” talks with online gaming company 888 Holdings Plc, after the Sunday Telegraph reported it had made a 240-million pound ($373 million) bid.
“There can be no certainty that these discussions will ultimately lead to an offer for 888 being made, nor as to the terms of any such offer,” Harrow, England-based Ladbrokes said in an e-mailed statement today. Andrew Benbow, a spokesman for Gibraltar-based 888, declined to comment when contacted by Bloomberg News today.
Ladbrokes bid 70 pence a share for the Internet casino and poker group it tried to acquire four years ago, the Telegraph reported, without saying where it got the information. 888 stock jumped 13 percent to 49 pence in London trading on Friday, Dec. 17, valuing the company at 169 million pounds.
Ladbrokes Chief Executive Officer Richard Glynn, who took over in April, wants to increase Internet winnings, which have been growing more slowly than those of rivals. The talks also reflect pressure faced by gaming companies as competition intensifies with the opening of markets in Europe and the U.S.
Governments are starting to allow online gambling companies outside their borders to offer services in domestic markets and bring currently illegal acts under the umbrella of taxation and regulation.
Online gambling in “offshore” markets, in which some companies may have customers in countries with official bans, expanded more than 10-fold between 2003 and 2010 to about 6.5 billion euros ($8.6 billion), according to H2 Gambling Capital, a Manchester, England-based consulting firm.
The U.S., Canada, Denmark, France, Italy, Ireland and Spain are among countries that have revised or are considering revising online gambling rules.
888, which supplies services to Harrah’s Entertainment Inc. said last month that third-quarter total operating income was $61 million, little changed from the year-earlier quarter.
Ladbrokes shares rose 0.4 percent on Dec. 17 in London to close at 127.5 pence, valuing the company at 1.2 billion pounds.
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