SBC News Voice of the Sports Betting Industry
The Sunday Times has reported that the governances of Rank Group and 888 Holdings have entered ‘relatively advanced’ negotiations to form a £2 billion merger.
Rank and 888 governances are expected to issue market updates on Monday outlining merger discussions, as the UK gambling industry sees further consolidation. As yet, little is known of how the merger transaction will be structured by both parties.
If successful the UK gambling sector, will see the creation of another FTSE-listed behemoth, as Rank operator of land-based gambling properties’ Grosvenor Casinos and Mecca Bingo merges its assets with 888 one of Europe’s largest igaming enterprises.
In a further industry twist, this morning it has been reported that Rank and 888 are considering a joint £3 billion takeover for William Hill.
Both Rank and 888 governances have confirmed that a consortium has been formed assessing the value of a potential takeover deal for struggling William Hill who this week ousted its CEO James Henderson following the ongoing decline of its digital performance.
Issuing a combined statement on Sunday, Rank and 888 governances detailed that although the consortium was studying its William Hill approach, at present there was no guarantee of a formal offer.
“The consortium sees significant industrial logic in the combination, through consolidation of their complementary online and land-based operations, delivery of substantial revenue and cost synergies and from the anticipated benefits of economies of scale, which will accrue to all shareholders.”
“In relation to the proposed transaction, no decision has yet been taken as to whether 888 would be an offeror or offeree company in respect of certain of the steps that may be taken in order to implement the proposed transaction.” Read the Rank and 888 consortium statement.
As a surprise takeover target, William Hill governance is expected to soon issue a statement rebuffing Rank and 888’s interests.
Reacting to this ground breaking news, UK business analysts have commented whether it was a wise move by Rank and 888 executive teams to state their interests in William Hill prior to confirming their own potential merger.
Furthermore, although struggling in 2016 William Hill remains the largest corporation of the involved parties. Regardless of ongoing industry consolidation, commentators have pointed that a three-way deal is fraught with risk, and may prove to be an unattractive option for William Hill investors.
