More Growth At Ladbrokes

Published: Thursday, September 15, 2005 Online-Casinos.com

MORE GROWTH AT LADBROKES

British betting group rumoured to be going after Sporting Index

Ladbrokes, one of Britain's biggest bookmakers, has emerged as a key contender to buy Sporting Index, the spread betting group, for up to GBP 70 million, The Times reported this week. Duke Street Capital, the private equity owner of Sporting Index, has whittled the auction down to a handful of bidders and set next week as the deadline by which they must table their second-round offers.

The shortlist is believed to comprise Ladbrokes, which is owned by Hilton Group, and two private equity firms. Bridgepoint is thought to be one of the contenders.

Duke Street, which is working with NM Rothschild, the investment bank, is expected to enter exclusive discussions with one party after next week's updated offers. The originally mooted asking price was closer to GBP 100 million.

Analysts said that Ladbrokes appeared to have the best chance of winning the auction. The company would have an advantage over private equity rivals by being able to cross-sell its own betting products to Sporting Index punters while offering Sporting Index to Ladbrokes customers.

There is also a historical link between the two companies in the figure of John Jarvis, Sporting Index's chairman, who was once chairman of Hilton International, the hotel arm of Hilton Group. Mr Jarvis left Hilton to set up Jarvis Hotels in 1990.

Ladbrokes, which abandoned a spread-betting foray in the 1990s, recently teamed up with a rival firm, Cantor Index, to offer financial fixed-odds bets.

Duke Street backed the GBP 53 million management buyout of Sporting Index in December 2002. The deal was led by Richard Glynn, the company's chief executive.