Betfair and Paddy Power take a ₤ 5bn merger punt
26 August 2015
Betfair and Paddy Power are set to combine in a ₤ 5bn bet9ja's welcome offer that would develop among the world's greatest online betting and gaming companies.
Final details are still being exercised, but the business said the deal had "engaging strategic logic" and boosted their market position.
Paddy Power shareholders would own 52% of the combined company, with Betfair investors owning the staying 48%.
The combined service would have annual earnings of some ₤ 1.1 bn.
"Discussions stay ongoing concerning the other regards to the possible merger," a statement stated on Wednesday, external.
the yohaig code brand-new group would be the UK online market leader with a 16% share, according to industry data, passing a merged Ladbrokes/Coral on 14%, as well as William Hill and the independently owned Bet365.
Shares in Betfair soared 17% to ₤ 30.60 on Wednesday, while Paddy Power leapt more than 18% in Dublin.
If the bet9ja's welcome offer proceeds, Breon Corcoran, manager of Betfair, would end up being president of the combined group, while his equivalent at Paddy Power, Andy McCue, would become chief operating officer.
'Everything about scale'
The combined company plans to maintain the "distinct and complementary" Betfair and Paddy Power brands in Europe.
Mr Corcoran said: "We fundamentally think this promotion code market is all about scale. By putting together two distinct however phenomenally strong brand names, we'll have a market leading position in the UK, Ireland, Australia and in the yohaig code United States."
Cormac McCarthy, Paddy Power's primary financial officer, said the combination was an "appealing chance".
"the yohaig code scale and ability is unsurpassed and would leave us in a better place to contend in our present markets, where competitors is intense," he said.
Given the complementary nature of the 2 companies, he was confident that any competitors concerns could be conquered.
Paddy Power was established in 1988, when 3 Irish bookmakers merged. It has 350 wagering shops and is the third-largest online bookie.
Betfair, on the other hand, is using a market - or betting exchange - that lets clients bypass the need for a standard bookie.
Based on their closing costs on Tuesday, Betfair was worth ₤ 2.4 bn and Dublin-listed Paddy Power was worth EUR3.4 bn (₤ 2.5 bn).
Industry mergers
Shareholders in Paddy Power would get a special code yohaig dividend of EUR80m.
There has actually been a flurry of merger activity in the betting sector in recent months.
In July, online betting firm 888 Holdings won a takeover battle for competing Bwin.party in a cash-and-stock deal valued at about ₤ 898m.
The 2 companies had remained in conversations since the middle of May.
Ladbrokes and Gala Coral also just recently sealed a ₤ 2.3 bn merger.
Online betting firm 888 purchases Bwin
17 July 2015
CVC shelves Betfair takeover bid
14 May 2013
