Update: Sportingbet Confirms: Will Hill-GVC Offer Turned Down


A statement was issued this week by Sportingbet plc that it has received an indicative offer from William Hill and GVC of 52.5 pence comprising of 45 pence in cash from William Hill and 7.5 pence in shares in GVC, and that its Board has found that this indicative offer significantly undervalues the business and its future prospects.

In their assessment, Panmure Gordon analysts said: "We believe Sportingbet is worth over 60 pence per share, excluding any bid speculation, and expect Wednesday's full year results to show the business continues to make strong underlying progress." Speaking of which, in its report, Sportingbet is expected to inform of pre-tax profits of around GBP 30 million on sales of GBP 200 million.

This is mostly thanks to Sportingbet's strong presence in Australia, while its European operations have been struggling with the economic downturn and a changing regulatory climate.

According to Numis, with this business growth potential, shareholders should hold out for 90 pence per share. They also said that since shares have risen from May's low of 26 pence to 44 pence, this could be observed by the bidder as a chance to snap up a bargain while trading was at a low point.

Based on the UK takeover rules, the bidders have until October 16 to make a firm bid or walk away. However, this deadline can be extended.

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