Rank CEO comments seen as indication of interest in tie-up with 888
Rank Group [LON:RNK] chief executive Henry Birch yesterday, 23 August said the rationale behind the UK-based gambling company’s proposed three-way merger with 888 Holdings [LON:888] and William Hill [LON:WMH] would apply to a deal involving only Rank and 888, The Times reported. The CEO said that while he would be constrained from commenting on a tie-up between Rank and 888, the same strategic logic would apply to such a deal.
The article noted speculation that Rank and the Gibraltar-based online gambling company 888 might pursue a merger now that William Hill, a UK-based bookmaker, has decisively rejected the joint takeover offer of GBP 3.4bn (EUR 3.95bn) from Rank and 888. Rank and 888 announced on 18 August that they no longer intend to make a formal offer for William HIll.
Birch said the rationale behind the proposed three-way merger had been to respond to a recent wave of consolidation in the UK gambling sector; to cross-sell products to a larger customer base; to gain scale; and to create a new type of gambling company.
Rank reported a pre-tax profit of GBP 77m on GBP 753m revenues in the FY to 30 June yesterday, the article noted.
Rank Group’s market capitalisation stood at GBP 850m at the close of trading in London yesterday, while 888 Holdings was valued at GBP 780m.