The deal comes after last week, GVC Holdings (LON:GVC) confirmed that it had offered 110p per share in cash and stock for Bwin, which would have valued the company at £906 million.
888 gained the recommendation of Bwin.party’s board even though its offer for the Gibraltar-based company was lower than what rival GVC Holdings Plc was considering paying.
“It’s all about scale…”
888 has offered 104.09 pence per share, a premium of 16.4% on the closing price on May 14 when the reverse takeover bid was first made.
If the $900 million bid wasn’t enough, 888Holdings is still trying to convince bwin.party to agree to accepting their proposal and allowing the takeover offer from the rival gaming giants. GVC shares gained 0.5 percent to 445 pence.
The companies also plan to consider making Bwin.party’s business-to-business technology unit into a standalone entity, which could be spun off as a separately listed company with shares being distributed to investors, 888 said.
Buying Bwin.party will provide the company with “significantly enhanced scale” as it seeks to take advantage of the anticipated market growth, while providing opportunities to increase efficiency in areas such as marketing, it said.
888 executive chairman Brian Mattingley commented: “This is a transformational opportunity for 888 in the consolidating online gaming industry, which is expected to grow significantly over the coming years”.
A combined group will have revenue of over $1 billion and be a leading online gambling operator in Belgium, Denmark, Germany, Italy, Spain and the UK.
Under the terms of the offer, Bwin.party shareholders will receive 39.45p in cash and 0.404 shares in the newly-plumped 888, although shareholders can vary the amount of each they’ll receive, if they so desire.
“Bringing our two groups together will generate substantial financial synergies for the benefit of both sets of shareholders and create a strong player with the breadth of product, brands and geographic coverage to grow faster than either business would be able to achieve stand-alone”, bwin.party Chairman Philip Yea added.