The betting group Ladbrokes is circling the troubled online gaming industry and hopes to cash in on the companies' distressed valuations. Merger and acquisition talks between internet betting firms are rife as they attempt to mitigate the loss of their US operations, outlawed after legislative changes in America which wiped billions off the value of online betting shares.
However, traditional casino operators and bookies are now circling the industry, looking to cherrypick the best assets at knockdown prices. They expect rapid growth across Europe and Asia.
A Ladbrokes spokesman confirmed: "It would be unusual if we were not to look at opportunities in the sector. We are monitoring the situation. We would always look to increase shareholder value."
One analyst, who declined to be named, said the most likely target was 888, which would add casino gaming to Ladbrokes' established online poker operation.
The speculation follows reports that 888 is in merger talks with PartyGaming to create a £1.6bn group. Advisers close to the talks said that the discussions were at an early stage. Both operate out of the giant Europort building in Gibraltar, which is also headquarters to 32Red, Ladbrokes' internet gaming arm and Coral's online operation. Analysts said it was unlikely consolidation talks were limited to just 888 and PartyGaming.
Ladbrokes is committed to online gambling and on Friday called for the Government to ensure the industry is properly regulated. Tessa Jowell, the Culture Secretary, is hosting a summit to agree industry standards on Tuesday.
Analysts say traditional casino operators and bookies are keen to get their hands on online operators' technology and marketing expertise.
source : http://www.telegraph.co.uk
