Casino giant Rank takes digital gamble with 888 merger

Casino operator Rank Group and online gambling operator 888 Holdings are in talks to create a £2bn gaming giant.

Discussions between Rank, which owns Grosvenor Casinos, and 888, whose brands include Bingo Fabulous, are understood to be relatively advanced. An announcement could be made tomorrow morning. City sources said the move was being labelled a merger, although it is unclear how Rank and 888 are structuring the transaction.

Advisers from the investment bank Morgan Stanley, accountancy firm PwC and lawyers from Slaughter & May are said to be working on the deal.

One source said the companies were coming together with the aim of launching a £3bn bid for beleaguered bookmaker William Hill. Such a move would create a new FTSE 100 company.

The tie-up between Rank and 888 is the latest blockbuster deal in Britain’s rapidly consolidating betting business. The wave of deal-making is being driven by rising taxes and a crackdown on fixed-odds betting terminals, the in-store gambling machines that can take tens of thousands of pounds each week.

Paddy Power and Betfair have already completed a £6bn merger. Meanwhile, Ladbrokes and Gala Coral are expecting confirmation next month from the Competition and Markets Authority (CMA) that their £2.3bn tie-up can go ahead.

If it is approved, the enlarged Ladbrokes and Gala Coral would leapfrog William Hill to become Britain’s biggest bookie, with more than 4,000 shops. It is expected they will be forced by the CMA to sell off hundreds of stores.

William Hill last year came close to buying 888 as part of a £700m takeover. Talks collapsed, however, after the online gaming company’s biggest shareholder refused to back the transaction.

888, which was founded by two Israeli families who still hold the majority of the shares, has long been seen as a takeover target, and has twice fought off attempts from Ladbrokes. Yet under boss Itai Frieberger, 888 has turned from prey into predator. It tried to buy Bwin.party last year, only to lose out to its rival GVC.

Its planned alliance with Rank would create a formidable operator, spanning upmarket casinos catering for high-rollers to internet poker.

The online powerhouse would stand in marked contrast to William Hill, which has struggled to adapt to gamblers’ changing habits.

Last week chief executive James Henderson left abruptly after failing to fix its online operations. The malaise engulfing the bookmaker leaves it vulnerable to an opportunistic takeover bid, bankers said.

Henderson was pushed out by chairman Gareth Davis. The chief executive, who took over from Ralph Topping less than two years ago, had been forced into a number of profit warnings and had seen a raft of senior staff depart. Davis said it could take a year for a new boss to be appointed.

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on whatsapp
WhatsApp

Related

Being Healthy While Travelling
Traveling

Tips on How to Remain Healthy While Travelling

Learn how you can stay healthy while travelling to any destination on earth. It doesn’t matter what country you are …

La Rinconada
Traveling

Guide to Visiting La Rinconada, the Highest Town in the World

Visiting La Rinconada The Highest Town In The World: This town is situated in the mountains of Tenerife. It is …

Acey Deucey Card
Other Card Games

The Acey Deucey Card Game

Acey Deucey Card Game is one of the oldest card games, and is an American version of a French game …

Carribean Stud Poker
Other Card Games

Learn About Caribbean Stud Poker Strategy

Caribbean Stud Poker, also known as casino stud poker is a table top game with many similarities to five-card stud. …

Other Card Games

Learn How Do You Play Casino Baccarat?

The first thing that you need to know about casino baccarat is that you are only required to play one …

blackjack
Other Card Games

Learn How to Play Blackjack in a Casino

If you have not been playing blackjack in a casino, then you might want to find out how to play …

Scroll to Top