(Corrects paragraph 4 of July 27 story to say that the companyhas cut costs, not struggled with cost savings)
* GVC makes 122.5p/share offer for Bwin
* Says Cerberus Capital to provide 400 mln-euro loan
* Cost savings to exceed 135 mln euros per annum
By Aastha Agnihotri and Neil Maidment
LONDON, July 27 (Reuters) - Online gambling firm GVCHoldings returned on Monday with a new 1 billion-pound($1.55 billion) bid for rival Bwin.party Digital Entertainment, looking to trump a recently accepted offer from 888.
Bwin, put up for sale last year, accepted a cash and stockdeal worth almost 900 million pounds from online casino andpoker firm 888 this month, shunning an earlier 908-million-poundoffer from GVC and Canada's Amaya Inc, which it deemedtoo complex and with less attractive growth prospects.
The tussle for Bwin is the latest in a flurry of merger activity in the industry, a trend likely to continue as firmsseek to expand to offset increasing taxes and tighter regulationin Britain. Last week Ladbrokes and Gala Coral agreed a $3.4billion all-share merger.
Bwin, which has struggled with the decline of regulatedpoker markets in Europe and has cut costs since its creation viaa merger of sports betting group Bwin and online poker groupPartyGaming in 2011, confirmed on Monday that it had received anew offer from GVC and would respond in due course.
888 declined to comment on whether it planned to raise itsoffer, though analysts said they widely expected it to do so.
"This is a real statement of intent from GVC. The proposedpremium over the accepted offer by 888 is such that thebwin.party board will probably have no choice but to reconsiderits acceptance of the 888 offer," Davy Research analysts said.
"We would be surprised if 888 does not come back with acounter-offer of its own."
GVC said it would finance the new deal through a combinationof new GVC shares and a 400 million-euro ($443 million) seniorsecured loan from private equity firm Cerberus CapitalManagement, removing Amaya's involvement and some ofthe complexity that had worried Bwin.
GVC, whose boss Kenny Alexander told the Financial Times onMonday that Bwin and several of its shareholders had been keenfor GVC to return to talks, also plans to raise 150 millionpounds through an equity placing to fund restructuring costs andrefinance existing debt at Bwin.party.
BATTLE FOR BWIN
GVC's offer of 122.5 pence per share, consisting of 25p incash and the rest in new GVC shares, is 18 percent higher than888's offer price of 104.09 pence.
The firm, whose shares listed on London's junior AIM marketgive it a market value which is less than a third of Bwin's,said the deal would lead to cost benefits worth more than 135million euros ($150 million) a year by the end of 2017, morethan double 888's estimated cost savings of $70 million.
U.S. activist investor Jason Ader, whose SpringOwl vehicleis among Bwin's five biggest shareholders, said GVC's new offerwas still not enough and he would still prefer 888 if there wasno further improvement in the bidding.
"If this was a 135p-140p price (from GVC) that might beenough for the Bwin shareholders to get comfortable with all theuncertainties. The 122p price is probably not enough, but it'senough to get the Bwin board's attention," Ader told Reuters.
He added that the onus was on Bwin's board to push GVChigher and invite 888 to reconsider its own offer.
Bwin's shares were up 2.4 percent at 111.2p by 1454 GMT,when GVC's share price was down 1.6 percent at 418p. ($1 = 0.9089 euros) ($1 = 0.6442 pounds) (Editing by Mark Heinrich and Greg Mahlich)
