Bwin.party Acquisition Wars, Part 2: 888 Holdings Bid Acknowledged
Last week’s increase in stock-market activity for both bwin.party and the two companies behind a “reverse takeover” bid of same, GVC Holdings (SportingBet) and Amaya, forced both bwin.party and GVC to publicly acknowledge that takeover attempt. But in announcing that, bwin.party also found itself needing to confirm a different takeover bid that remains under consideration.
That other bid, now publicly acknowledged, is a €750 million bid received from 888 Holdings PLC. As with Amaya, part of the other known active bid currently under consideration by bwin.party, 888 Holdings is a prominent competitor of bwin.party’s across most of the European market.
The bid from 888 involves an unknown amount of cash in combination with a share swap between the two companies, and though it carries a significantly lower face value than the rival offer from GVC/Amaya, the actual per-share values of each bid have yet to be publicly compared.
As with the GVC/Amaya-bwin.party situation, officials at both bwin.party and 888 now feel compelled to disclose the existence of this other takeover bid. Here’s part of what 888 stated today:
Statement re: bwin.party digital entertainment plc (“bwin.party”)
The Board of 888 (the “Board”) has noted the recent press speculation concerning a possible offer for bwin.party by 888 and RNS announcement by bwin.party. The Board believes that there is significant industrial logic in a combination of 888 and bwin.party, benefiting both companies and all shareholders and accordingly, has submitted a proposal regarding the acquisition of the entire issued and to be issued share capital of bwin.party for consideration comprising cash and 888 shares.
Due to the size of the proposed transaction, it would require, inter alia, the approval of 888 shareholders. 888 shareholders representing approximately 59% of 888’s share capital have irrevocably committed, subject to customary conditions, to vote in favour of the proposed transaction.
There can be no certainty that the submission of this proposal will lead to the Company being selected as the proposed acquirer of bwin.party or, in turn, completing a transaction. A further update will be provided in due course. …
Bwin.party’s statemenrt was rather more brief, noncommittal, and highly similar to what was offered regarding the GVC/Amaya bid. According to bwin.party:
Announcement by 888
The Board of bwin.party has noted the announcement made by 888 Holdings plc and confirms that it has received a proposal to acquire the entire issued and to be issued share capital of bwin.party. The Board and its advisers are conducting a detailed review of the proposals received to-date and will make a further announcement in due course, however there can be no certainty that these proposals will result in a transaction being completed.
Analysts have already noted that 888’s bid and possible absorption of bwin.party may also have the effect of making 888 itself a bit less of an acquisition target itself, in an overall market which remains ripe for consolidation. 888 has been noted as “susceptible” to takeover attempts, if not quite on the level of bwin.party, a bloodied and money-dripping beast which has been targeted by market rivals for at least the last three years.
In 888’s case, Ladbrokes and William Hill have both made previous acquisition attempts, though neither came to fruition. Those companies have also been reported to have at least considered acquiring bwin.party, with serious rumors about a possible Laddies bid circulating within the industry a couple of years back.
Whether the 888 bid or the one from GVC/Amaya finally turns out to be the key that unlocks the bwin.party puzzle remains unclear. Still other bids may emerge, yet it seems that if other bids were under active consideration, they’d have also been disclosed by bwin.party at this time.
The likeliest solutions include a segmenting of the firm into several distinct units, no matter who ends up doing the acquisition. Such a scenario would allow any buyer to focus on the best pieces of bwin.party to complement its own market prsences, since the vast bwin.party conglomerate has a presence in many different market segments. That approach would also help reduce exposure — and allow for a corporate restructuring — in various “gray” market jurisdictions. Bwin.party is generally regarded as overexposed in such jurisdictions, placing the company at the whim of various nationalities and new licensing regimes.