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Online gambling firm GVC could have another go at Bwin

Published 21/07/2015, 10:28
© Reuters.  Online gambling firm GVC could have another go at Bwin
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By Mamidipudi Soumithri

(Reuters) - Online gambling firm GVC Holdings Plc (L:GVC) could make another attempt to buy peer Bwin.party Digital Entertainment (L:BPTY), just days after Bwin accepted a 900 million pound offer from 888 Holdings Plc (L:888).

GVC said on Tuesday it was considering its options regarding Bwin, but there was no certainty it would make a new offer.

It made a 110 pence per share offer for Bwin earlier in July along with Canada's Amaya Inc (TO:AYA).

Bwin, which has been at the centre of a bidding war between GVC and 888, accepted a 104.09 pence a share bid on Friday from online casino and poker firm 888 after months of talks with the two sides.

Bwin said at the time that GVC's proposal had additional execution risks and the premium it offered was not enough for Bwin's board to recommend it.

Michael Campbell, analyst at Northland Capital Partners, said GVC was likely to come back with a larger offer, but added that it would have to be a minimum of 115-120 pence per share.

"For GVC to win that business, they're really going to have to come back with a quite a bit of a competitive bid, in my own view, and if it's south of 115, 120 I can't see shareholders voting in favour of a GVC deal," he said.

The online gaming industry has seen a flurry of M&A activity as firms expand in order to offset the impact of increasing taxes and tighter regulation.

GVC's joint bid for Bwin, a company more than triple its size, would have involved breaking up the firm into units that could then be separately absorbed by GVC and Amaya.

The Telegraph newspaper reported on Monday that GVC could consider making another approach for Bwin, this time on its own, to remove many of those concerns.

Campbell said he would be surprised if GVC could land the deal without the backing of a company such as Amaya.

A GVC spokesman declined to comment on Tuesday about the possibility of making a solo bid for Bwin, but added it was not ruling in or out any options.

888 and Bwin were not available for comment, while Amaya was unavailable to comment outside of normal business hours.

GVC shares were up 2.7 percent on the London Stock Exchange on Tuesday morning. Shares in Bwin were flat, while 888's shares were marginally down.

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