Skip to main content

UK press getting sucked in again over Betfair float talks

The financial sections of Sunday's papers got all excited about rumours of a Betfair float again.

Betfair considers £1.5bn flotation

The logic is all wrong. The company has been profitable every year since it began. Its cash reserves are huge and there would be little benefit in going to market. The company does however need an exit strategy for the next maturing staff share plan in October, and if and when Andrew Black decides to step away completely from the business, which is a possibility as he has little to do with the firm apart from board activity these days. A full-scale float in either of those cases is unlikely to be required. The other option would be if major investor Softbank wanted to bail out, but that's unlikely after just a couple of years, unless they have issues elsewhere. Or perhaps a listed company would look better to American authorities if the market there was opening up....

Betfair will float eventually. They have been reporting like a floated company and preparing for the relevant corporate governance and responsibility for years. Unless they suddenly wanted to buy a land casino or a major competitor, I'd be very surprised if they floated in the near future. This talk has happened several times before, Betfair were serious about it when they appointed Stephen Hill as CEO a few years back, but they decided it wasn't right at the time and Hill departed soon after. Journos love something to talk about on quiet news days, and it's not as if there have been many big IPOs lately with the state of the economy!

Footnote - I no longer have anything to do with Betfair apart from writing the occasional article for them and drinking with ex-colleagues occasionally, none of whom would be involved in any decision-making process regarding an IPO.

Comments

Popular posts from this blog

It's all gone Pete Tong at Betfair!

The Christmas Hurdle from Leopardstown, a good Grade 2 race during the holiday period. But now it will go into history as the race which brought Betfair down. Over £21m at odds of 29 available on Voler La Vedette in-running - that's a potential liability of over £500m. You might think that's a bit suspicious, something's fishy, especially with the horse starting at a Betfair SP of 2.96. Well, this wasn't a horse being stopped by a jockey either - the bloody horse won! Look at what was matched at 29. Split that in half and multiply by 28 for the actual liability for the layer(s). (Matched amounts always shown as double the backers' stake, never counts the layers' risk). There's no way a Betfair client would have £600m+ in their account. Maybe £20 or even £50m from the massive syndicates who regard(ed) Betfair as safer than any bank, but not £600m. So the error has to be something technical. However, rumour has it, a helpdesk reply (not gospel, natur

What shits me about match-fixing 'journalism'.

The anti-wagering media bandwagon has dozens of new members this week, all weighing in an industry they have absolutely no idea about. I'm all for getting the betting industry into the mainstream but it shits me no end when they roll out reports and celebrities who simply don't have a clue what they are talking about and don't bother to check basic facts which key arguments in their story. If this was the financial industry, making errors like this would have them in all sorts of trouble, but the same level of regulation doesn't apply because finance stock markets are supposedly all legitimate and serious, whereas sports betting is just a bit of fun for people who can never win in the long-term... according to the media. This week we have seen the sting by the Telegraph which, on the face of it, looks to be a tremendous piece of investigative work into fixing in English football. But the headlines around it are over-sensationalised yet again. Delroy Facey, a former pla

The Cup review

James McDonald feels the emotion of winning the Melbourne Cup on Verry Elleegant. (photo credit Darrian Traynor/Getty Images) With every man and his dog doing Cup previews these days, perhaps a postmortem of the race provides more value - at least for these more serious about the game or want something to refer back to in 363 days' time. It was great to see Flemington basking in the warm spring sun, with no threat of rain which buggers up the confidence you have in the state of the track, an integral part of betting on horses. The crowd was back, at least about 10% of the normal Cup day crowd, but 10,000 more than were allowed last year. Let us never have to deal with these restrictions again in our lifetimes. The TV coverage - well, um, ugh. On Derby Day, I was able to watch the racing.com stream in the UK while Sky Sports Racing kept to their normal NSW-controlled Sky Racing Aus coverage which denies that Victoria and South Australia exist. For Cup Day, they switched to the Chann