888 Holdings, operator of the world’s second biggest online poker network, has confirmed it is in “advanced talks” over a Â£750 million ($1.47 billion) takeover by British bookmaking giant William Hill.
The news this week prompted an 18 percent jump in 888’s shares, which closed up 26.5p to 171.5p on Tuesday, while William Hill shares dipped 5.5p to 384.13p.
888, which is licensed in Gibraltar but listed on the London Stock Exchange, rushed out a statement on Thursday following market chatter about a possible acquisition.
“The board of the company confirms that it received an approach regarding a possible offer for the company by William Hill,” it said. “There can be no certainty, however, that any firm offer will be made nor as to the terms on which any firm offer might be forthcoming.”
It’s not the first time that a market-leading UK bookmaker has been close to acquiring 888. Ladbrokes attempted to buy the company in 2006 but backed out following the uncertainty surrounding the passage of the Unlawful Internet Gambling Enforcement Act, which saw 888 withdraw its operations from America.
Ladbrokes again showed an interest four years ago, when it valued the company at Â£150 million ($230 million), but ultimately decided that the deal was “not in the interests of shareholders.”
William Hills’ approach comes at a time of expected consolidation within the UK gambling industry, a reaction to the new 25 percent point of consumption tax which is likely to eat into profits.
Moreover, the acquisition of 888 will bolster William Hill’s online offering, complementing its strong sports betting operations with 888’s technological knowhow and strength in online poker and casino.
888 Holdings was founded in 1997 by Israeli brothers Avi and Aaron Shaked and Shay and Ron Ben-Yitzhak. Its first casino platform, Casino-On-Net, rebranded in 2010 as 888Casino.com, was unveiled that same year, followed in 2002 by 888poker and Pacific Poker.
The company also operates a large network of bingo websites and currently the only real-money bingo app on Facebook. All in-house software is designed by its subsidiary software company, Random Logic.
Today, following a period of sustained growth over the past four years, 888poker has become the second biggest poker network in the world, after PokerStars.
In 2012, following a six-year hiatus it reentered the newly regulated US markets and now provides the software platforms for the market-leading brands in Nevada and New Jersey, WSOP.com, as well as all three racetrack operators in Delaware.
Its closest competitor in New Jersey, bwin-party, was itself the subject of takeover speculation recently, with both PokerStars parent Amaya Gaming and software company Playtech rumored to be in the mix.
In November it was reported that Amaya was preparing a $1.2 billion takeover of the company, although there has been no update on the progress of any bwin-party acquisition deal since then.