LONDON (Alliance News) - GVC Holdings PLC on Friday secured a recommendation for its takeover bid for Bwin.Party Digital Entertainment PLC, forsaking the agreement previously reached with 888 Holdings PLC and prompting 888 to withdraw from the tussle.
GVC said the Bwin board has agreed to its takeover offer of 25 pence in cash and 0.231 GVC shares per Bwin share, valuing the FTSE 250-listed gaming company at around GBP1.12 billion, or 129.64 pence per share.
GVC said the offer is a 12.5% premium to Bwin's closing share price on Thursday and a 45% premium to the value of Bwin shares on May 14, when GVC and 888 first entered talks to acquire the business.
The offer will include a 'mix and match' facility, so that Bwin shareholders will be able to elect to vary the proportions of cash and new GVC shares they receive. Following completion, Bwin shareholders will own about 66.6% of the enlarged group.
Bwin confirmed on Friday that it has terminated its agreement with 888.
"In recommending the offer from GVC, the board has taken into account many factors including, but not limited to, the headline value per share and the consideration being offered, the level, timing and deliverability of the financial synergies to be generated and the enlarged group's growth strategy in an increasingly competitive marketplace," said Philip Yea, Bwin's chairman.
"As a result of these and other factors, including the proven track record of GVC's management team in creating substantial value for shareholders, after a carefully managed and diligent review process, the board has withdrawn its recommendation for the 888 offer and is now advising Bwin.Party shareholders to vote in favour of the offer from GVC," Yea added.
Later on Friday, 888 said that it has elected to withdraw from the bidding for Bwin and has stopped its discussions with the company. 888 said it "cannot see sufficient value in bwin.party to warrant a revision to its offer".
Bwin shares were down 0.4% to 114.70p on Friday just after midday in London, while GVC shares were down 5.1% to 430.10p. 888 shares were down 1.0% to 160.35p.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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