Sport is made for betting

Four years after pulling out of a proposed deal because of concerns about US legality, Ladbrokes PLC have confirmed they are in discussions to buy 888 Holdings. It's been a tough few years for 888 who were valued at 240p per share back in 2006, but last week before the announcement were south of 50p (now 56p after peaking around 60p). According to this report though, Sportingbet (who are known to be looking around for merger and acquisition targets after recent talks with Unibet) and Harrah's could be sniffing around as well.... Meanwhile, in other trading news, Goldman Sachs have upgraded their Betfair rating from neutral to buy . Not much conflict of interest there considering they were the investment bank who floated them, and are now probably desperate to save face as the company trades more than £3 below IPO price, and over £5 below the peak during restricted trading.....

There was an article yesterday behind the FT paywall attacking the valuation of Betfair and its growth prospects. This essentially echoed my thoughts in various posts here and discussions with a couple of investment firms. I don't see the price crashing, but I do think that growth prospects are limited in the short-term. Their big upshot will be if one of the biggest nations in the world opens up, such as China, India or the US. Don't hold your breath though, that might take a while. Betfair reply to analyst’s unfavourable share forecast After picking up three awards at the eGR Awards on Wednesday night, narrowly missing out on the Operator of the Year award, it’s neigh-on definite that attending on behalf Betfair will have left you quite the hangover to deal with. This will have been made significantly worse by a news item published on FT.com yesterday morning – something that isn’t curable by a Bloody Mary. After the founders floated it last month, Betfair’s stock was p...

Rival bookmaker Bodog don't mind a bit of innovative publicity, such as being first to price up who killed Archie Mitchell in EastEnders, which was then copied by several other firms. This time they have gone up with markets on the Betfair IPO valuation and the market moves are telling a story. Initially, under £1.4bn (remember, the figure quoted in most of the press was £1.5bn, which was their valuation in 2005 when Softbank purchased 23% of the company) was priced at 8/11 with over that figure available at evens. But money has come strongly for the under, forcing it down to 1/2, then 1/3. A Bodog spokesman said: “We have had 182 bets on the downside compared to just 22 on the upside. For a bet this niche this is quite a lot. Having a lot of experience in this industry I’m pretty certain these people will turn out to be right. “We even had people setting up multiple accounts so they could get three bets at the maximum of £500 a bet.” Sounds like a few ex-staff starting to ...

Not that Betfair will admit it, but the Racing Post today is reporting that Betfair have shelved plans to float this summer as world markets sink back into volatility, particularly over the Greek economic crisis. Betfair put off flotation due to volatile market By JonLees 7:24AM 18 MAY 2010 BETFAIR is understood to have postponed plans for a £1.5billion flotation onthe stock exchange this summer as a result of uncertainty in the world markets. The volatility in the sector, which endured another roller-coaster period last week, is believed to have led the betting exchange's advisers to counsel against a stock market flotation or IPO (initial public offering) which had been tipped to happen in July. In the past six months the company completed a string of high-level recruitments to prepare for a flotation which had been tipped for July. It would have marked the summit of a spectacular rise by the company, which in the course of less than ten years has become the largest online sport...

In all the posturing between Gordon Brown and David Cameron before the UK general election sometime next year, the big debate is now how are we going to pay for the mess we are in, particularly the huge government bail-out of the economy. Brown has proposed a sale of several public assets including the Tote again, the sale of which had been put on the shelf during the economic downturn. Government's £16bn sale of assets Is this what is best for the country or just the bet they can come up with to save Brown's arse as PM? As Vince Cable says in the article, "This is not a good time to sell assets." Dumping it cheaply will not serve the racing industry like it is supposed to. Here's a thought. Rather than constantly talking of selling the Tote off at a fire sale price, how about floating it? Encourage mum and dad buyers to get involved, and hopefully increase the client base as well. People who buy shares in a firm are more likely to spend money there when given a c...