Playtech’s £700m Bid for 888: A Summer Tale of Acquisition Ambitions
Playtech's attempt to acquire 888 Holdings for £700 million was rejected in the summer, which caused 888's stock to rise 19%. 888 faces a turbulent 2023 amidst management changes and regulatory obstacles. The unsuccessful offer comes after DraftKings' previous evaluation and highlights how the iGaming industry is changing in the face of regulatory scrutiny and takeover attempts.
888 faces volatile stock prices after rejecting Playtech's £700 million takeover bid
It is purported that Playtech made an attempt in the summer to pay £700 million ($887 million) for 888 Holdings. The Sunday Times claims that the gambling technology company submitted a written bid in July for roughly £1.56 ($1.98) per share to buy the owner of William Hill.
Some Playtech staff members thought that combining the two businesses would lead to synergistic savings of about £170 million ($215 million), according to sources close to the outlet.
On Monday morning, the news of the attempted takeover caused the share price to rise by 19%.
Since 888 turned down the offer because it was too low, the value of its shares has drastically decreased. It was taken out of the FTSE 250 last week, an index that includes the 101st through 350th biggest companies that are listed on the London Stock Exchange. 888's shares, which are valued at about $376 million ($476 million) on the market, increased 19% on Monday morning in response to the takeover attempt.
Chaos Ahead for 888 in 2023: Financial Difficulties, Regulatory Issues, and Management Changes
Thus far, 888's 2023 has been difficult due to regulatory obstacles, poor financial performance, acquisition talks, and changes in key management positions.
About 5% of 888 is owned by the FS Gaming group, which has been at the center of several recent disputes. Gambling company Entain was forced to pay £585 million ($741 million) in settlement after a few of its employees were linked to a significant bribery scandal in Turkey.
Before the problems were made public, it was suggested that a few of these investors become part of the 888 management team. The license to offer sports betting was reviewed by the UK Gambling Commission due to the operator's affiliations with these individuals.
DraftKings Is Considering Purchasing 888, Playtech's Purchase Trend Persists
In recent memory, this is not 888's first takeover attempt. It was revealed to the public last month that large US sportsbook DraftKings was also thinking about acquiring in the summer. In the end, concerns about the license review caused the operator to withdraw from the negotiations.
Playtech, one of the leading developers of online casino games globally, is the owner of Sinai, a well-known sportsbook in Italy. The company has recently made a number of notable acquisitions; last year, it paid nearly £2 billion ($2.5 billion) to acquire William Hill's non-US assets. Debt was a major source of funding for this deal.
