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Welcome to the News desk.
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Betfair ponders a punt on £1.5bn public listing |
23/08/2009 |
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Nick Mathiason
Betfair, the internet gambling business that lets punters be
bookmakers, is inching closer to a possible £1.5bn stockmarket flotation.
Reports that the peer-to-peer
betting website held talks with bank advisers with a view to a possible public
listing have been played down, though sources close to the innovative gambling
firm suggest a flotation is being actively considered.
Betfair has long
eyed a flotation, having launched 11 years ago. It has consistently made large
profits but its uncertain tax status and difficult equity markets have delayed
an exit for its two founders, Andrew Black and Ed Wray, who between them own
26% of the company.
The recent
stockmarket rally and the need to raise capital to ensure the firm is a leading
player in the sector's consolidation could make a float possible in the next 12
months, company insiders concede.
Betfair is receiving advice from
bankers on potential acquisitions in the gambling sector, which is experiencing
a new wave of consolidation. The company's success is mainly due to
the odds offered being more generous than bookmakers, because customers laying
bets are not subject to the same taxes that typical bookmakers faced.
BetfairThe firm's results earlier this month showed revenues rising 27% to
£303m in the year to 30 April, with active users people who placed
a bet over the period up 25% to 652,000. Betfair, which takes a
commission of up to 5% on each winning bet, said core earnings rose 29% to
£72m. The firm took two billion bets last year. Its other main
shareholders include Softbank, the Japanese bank, which owns 23%, a private
equity firm, management and a collection of wealthy individual backers.
Corporate advisers have endured a frustrating two years as public markets
have in effect been closed for listings. There is speculation that towards the
end of the year there could be a flurry of flotations. Acromas, the private
equity outfit that owns AA and Saga business, is said to be preparing the
ground as well as Pets at Home, Merlin Entertainments, the London Eye operator,
and Birds Eye.
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