The board of directors at Betfair have rejected the £912 million offer from CVC, claiming the offer “undervalued” the company.
This is despite current shares valuing the company at approximately £840 million. Ironically, the shares saw one of the biggest jumps in their IPO history when CVC announced the offer, when they leapt up by an astonishing 35 points (4.4%).
The Betfair board summed up their rejection of the offer by stating they are “confident in the company’s strategy and growth prospects as it goes through an exciting stage”.
But of course, the question on everyone's lips is, will CVC make a counter offer?
Betfair are due to provide a further market update on 7th May 2013.
For the full details on the Betfair share position, visit The Telegraph.
Plus, you can read a full review of the Betfair Casino here.
Monday 22 April 2013
Tuesday 16 April 2013
Got Shares In Betfair?
There is a chance that Betfair’s troubled three years on the stock market could be coming to an end, if the latest reports in the financial media are to be believed. Private equity firm CVC is said to be considering a takeover offer though to be worth an estimated £800 million, which has caused Betfair’s usually floundering share price to rocket by 12% at its peak yesterday (as reported by the WSJ). Although there has been no confirmation by Betfair bosses or by CVC executives that a bid is in the offing, industry gossip has nevertheless leaked the news, seeing it as a rescue for a company, who, by their own admission has “lost their way”.
The current Chief Executive (the latest in a long line of CEOs trying to save the ailing brand), Breon Corcoran, who joined Betfair from Irish rival Paddy Power in early 2012, made the comment shortly after his appointment, and has since taken several drastic steps to try and reduce its shortcomings. These steps include pulling out of the troubled Greek and Cypriot markets and backing out of Germany due to on-going license problems. However, the share price has continued to tumble, nevertheless, with shares losing half their value since the flotation in late 2010.
But what does this mean for the Betfair shareholder? Shareholders were promised the moon when the company first floated – with an IPO valuation of 30 times historic earnings, they had to be. Huge, rapid expansion never materialised, and large chunks of the company have been sold off. Nevertheless, Betfair offers a unique betting platform and is a cash rich brand with lots of potential – providing they can turn around their fortune.
CVC could bring its own benefits to the brand however. The private equity firm owns the Formula One motor racing brand, as well as gym chain Virgin Active and the parent company of Madame Tussards. Plus, they already have experience in the gambling sector, having bought William Hill in 1999 and selling three years later.
If you have shares in Betfair, you are advised to stay up to date with the latest developments from both Betfair and CVC, and think carefully about your own interests. CVC cannot tender a bid unless all the shareholders agree, and the result must be right for the future of the firm. With 39% of Betfair shares still owned by four shareholders (including Richard Koch and Antony Ball) it would look like any potential bid for the company will see stiff negotiations, given the potential which still exists for the brand. If CVC are expecting Betfair to be an easy buy, they could be sadly mistaken.
If you are a casino player and have never played at Betfair before, take a read of an independant online casino review here to find out what all the fuss is about.
The current Chief Executive (the latest in a long line of CEOs trying to save the ailing brand), Breon Corcoran, who joined Betfair from Irish rival Paddy Power in early 2012, made the comment shortly after his appointment, and has since taken several drastic steps to try and reduce its shortcomings. These steps include pulling out of the troubled Greek and Cypriot markets and backing out of Germany due to on-going license problems. However, the share price has continued to tumble, nevertheless, with shares losing half their value since the flotation in late 2010.
But what does this mean for the Betfair shareholder? Shareholders were promised the moon when the company first floated – with an IPO valuation of 30 times historic earnings, they had to be. Huge, rapid expansion never materialised, and large chunks of the company have been sold off. Nevertheless, Betfair offers a unique betting platform and is a cash rich brand with lots of potential – providing they can turn around their fortune.
CVC could bring its own benefits to the brand however. The private equity firm owns the Formula One motor racing brand, as well as gym chain Virgin Active and the parent company of Madame Tussards. Plus, they already have experience in the gambling sector, having bought William Hill in 1999 and selling three years later.
If you have shares in Betfair, you are advised to stay up to date with the latest developments from both Betfair and CVC, and think carefully about your own interests. CVC cannot tender a bid unless all the shareholders agree, and the result must be right for the future of the firm. With 39% of Betfair shares still owned by four shareholders (including Richard Koch and Antony Ball) it would look like any potential bid for the company will see stiff negotiations, given the potential which still exists for the brand. If CVC are expecting Betfair to be an easy buy, they could be sadly mistaken.
If you are a casino player and have never played at Betfair before, take a read of an independant online casino review here to find out what all the fuss is about.
Wednesday 3 April 2013
What Does the 80% Growth in UK Online Gambling Mean?
The online gambling industry has been abuzz with the news over the last few days stating that there has been an 80% increase in UK online gambling revenue since 2008. The figures show that the online gambling industry in the UK was worth an incredible £2 billion in 2012, compared to £1.27 billion in 2008. The increase has been put down to several factors; notably the increase in mobile gambling technology, the increase in online casinos and the wide variety of sports betting events which have taken place in the last several years.
Where Have The Increases Been Seen?
Sports Betting: Up 102%. Sports’ betting still dominates the industry, making up 44% of the overall revenue, an increase undoubtedly due to the advances in mobile phone and online betting platforms in the last two years.
Online Casinos: Up 79%. With the second biggest market share, the last several years has seen a flood of new online casinos, on computers, tablets and mobile phone devices.
Online Bingo: Up 155%. Worth 17% of the market, this huge increase will have been aided by the closure of a lot of land based bingo halls which has sent their players to online platforms.
Online Poker: Up 8%. A smaller increase, but this means that online poker contains 15% of the online gambling market in the UK, its smaller percentage possibly due to the game being harder to master.
Is This Good News For the UK?
Well, yes, for the UK online gambling industry it is excellent news, as it shows the industry is still developing and profiting. However, there have been estimates made by analysts that the UK Government has missed out on a whopping £2.1 billion in revenue since setting the tax rate at 15%, by effectively forcing UK based gaming companies out of the country.
Many companies, such as William Hill (who command a 15% share of the overall market), have since moved their operations offshore to take advantage of more flexible tax rates, which has meant a huge loss of revenue for the UK, in terms of corporation taxes, income tax and National Insurance payments to name but a few revenue sources. You can read an independant review of William Hill Casino here.
Ian Burke, the CEO of the Rank Group, has hit out at politicians in the UK who consistently take a derogatory view of the online casino and gambling industry, and was recently quoted as saying the politicians’ negative statements with regards to casinos are confusing for the public. Burke stated that the way people gamble has changed, and the heavy restrictions and responsibilities held by online gambling companies today mean people gamble responsibly and overall, simply for fun.
The poor relationship between the online gambling industry and UK government is now be being tackled head on, as there are currently discussing to reduce the tax rate to tempt back some of these big, profitable employers (see here for more). For the UK Government – who are currently under fire for public and social cuts being made – it seems that by adjusting their attitude to the strictly regulated world of online gambling they could easily boost their ailing coffers. By modernising their old fashioned attitudes to online gambling, and start seeing it as the thriving, profitable industry that it is, why shouldn’t the UK economy benefit from this amazing growth too?
Where Have The Increases Been Seen?
Sports Betting: Up 102%. Sports’ betting still dominates the industry, making up 44% of the overall revenue, an increase undoubtedly due to the advances in mobile phone and online betting platforms in the last two years.
Online Casinos: Up 79%. With the second biggest market share, the last several years has seen a flood of new online casinos, on computers, tablets and mobile phone devices.
Online Bingo: Up 155%. Worth 17% of the market, this huge increase will have been aided by the closure of a lot of land based bingo halls which has sent their players to online platforms.
Online Poker: Up 8%. A smaller increase, but this means that online poker contains 15% of the online gambling market in the UK, its smaller percentage possibly due to the game being harder to master.
Is This Good News For the UK?
Well, yes, for the UK online gambling industry it is excellent news, as it shows the industry is still developing and profiting. However, there have been estimates made by analysts that the UK Government has missed out on a whopping £2.1 billion in revenue since setting the tax rate at 15%, by effectively forcing UK based gaming companies out of the country.
Many companies, such as William Hill (who command a 15% share of the overall market), have since moved their operations offshore to take advantage of more flexible tax rates, which has meant a huge loss of revenue for the UK, in terms of corporation taxes, income tax and National Insurance payments to name but a few revenue sources. You can read an independant review of William Hill Casino here.
Ian Burke, the CEO of the Rank Group, has hit out at politicians in the UK who consistently take a derogatory view of the online casino and gambling industry, and was recently quoted as saying the politicians’ negative statements with regards to casinos are confusing for the public. Burke stated that the way people gamble has changed, and the heavy restrictions and responsibilities held by online gambling companies today mean people gamble responsibly and overall, simply for fun.
The poor relationship between the online gambling industry and UK government is now be being tackled head on, as there are currently discussing to reduce the tax rate to tempt back some of these big, profitable employers (see here for more). For the UK Government – who are currently under fire for public and social cuts being made – it seems that by adjusting their attitude to the strictly regulated world of online gambling they could easily boost their ailing coffers. By modernising their old fashioned attitudes to online gambling, and start seeing it as the thriving, profitable industry that it is, why shouldn’t the UK economy benefit from this amazing growth too?
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