BUSINESS

William Hill Rubber Stamp the Sportingbet Deal

TAGs: Lee Davy, Ralph Topping, Sporting Bet, William Hill, William Hill Online

William Hill Rubber Stamp the Sportingbet DealIt’s been a busy month for William Hill Chief Executive Officer (CEO), Ralph Topping. Just weeks after the absorption of the 29% stake that Playtech held in William Hill Online (WHO) – in a deal worth £425m – Topping has finally rubber stamped the acquisition of the Australian arm of Sportingbet.

Topping had always maintained that the Australian market was a ‘sweet spot’ and an area of growth that he had been ‘eyeing for quite some time’, and now he has his foothold. William Hill PLC & GVC Holding shook hands on a deal that finds them take on Sportingbet’s Australian business (including Centrebet), and also a call option over Sportingbet’s locally licensed Spanish facing Miapuesta business for a total cash consideration of £459.4m.

Ralph Topping, CEO of William Hill said:

“This acquisition is part of our core strategy to expand selectively into international markets and to grow online revenues. Australia is one of the largest licensed betting markets in the world where, up until now, William Hill has not had a footprint. We have particular skills in those areas of the Australian market that are demonstrating strong structural growth: online, mobile, fixed odds betting and sports betting. The Australian business offers us a well-recognized brand, an experienced team and a market-leading position in a highly competitive market. We look forward to working with our new colleagues to use the capabilities of both businesses to maximize that position.”

The listings of the Sportingbet shares and Sportingbet Bonds are expected to be cancelled by the London Stock Exchange with effect 08.00 a.m. on 20 March 2013 and 08.00 a.m. on 22 March 2013 respectively. Sportingbet shares and Sportingbet Bonds will remain suspended pending that cancellation taking effect.

The city boys have been analyzing William Hill’s performance with Goldman Sachs reaffirming their ‘Neutral/Neutral’ rating in a research note issued earlier this week. They currently have a £5.67 (367 GBX) price target on the stock.

Analysts at UBS AG raised their price target on shares of William Hill from $5.44 to $6.42 and now have a ‘Neutral’ rating, four other research analysts have rated the stock with a “Sell’ rating, two have slapped a label of ‘Hold’ with eleven handing out a ‘Buy’ rating. The stock currently has a consensus rating of ‘Hold’ and a consensus price target of $6.30 (417 GBX).

William Hill has a 52-week low of GBX 240.90 and a 52-week high of GBX 447.70. The stocks 50-day moving average is currently 314.1. Their market cap is £2.716 billion.

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