Ladbrokes latest takeover target: Sportingbet

Yesterday shares in Sportingbet PLC surged 16% on the news that it had received a “highly preliminary approach” from larger rival Ladbrokes.

It seems Laddies’ fervent attempts to transform their online business through acquisition are set to continue despite failed attempts to get something going with 888.com and Playtech already this year.  It was only a month ago that CEO Richard Glynn instructed his bankers, UBS and Greenhill, to close discussions with 888 and now they’re talking to Sportingbet (not sure if the Playtech merger deal is still bubbling).

Two things are clear though…

1. Ladbrokes are DESPERATE to buy another online gambling business; and
2. UBS and Greenhill should think about changing their fee structure with Ladbrokes from a success fee to a daily rate.

The Sportingbet approach is an interesting one given the fact they (Sportingbet) have just completed a £119 million purchase of Centrebet.com – one of the ‘big 4’ Australian online sports betting operators.  Ladbrokes were also sniffing around that deal (of course) but left the picture when the bidding got too high and made no secret of the fact that they thought Sportingbet had paid way too much.

Now, if they end up buying Sportingbet, they inherit the overpriced Centrebet by default. But I guess if you’re that desperate to buy an online business you have to be prepared to make compromises here and there.

Never a dull moment in the land on Internet gambling!