Word has been going out in Britain that it is possible that the sports betting site, Ladbrokes, will be acquiring 888.com, the Gibraltar-based online gambling group and there has been an increase in the buzz over the weekend as the media has been reporting on this company’s possible strategy.
It was reported by the newspaper, the Financial Mail and by Sky TV reported Sunday that the sports betting site Ladbrokes would be able to evade possible United States criminal charges by carrying out a specially-designed takeover of 888.com worth GBP440 million. The strategy is to take out the major part of 888.com’s assets, rather than purchasing the entire group.
There is a lawyer who is quoted in the article as saying that when the company might be liable to criminal charges from the United States, selling to a better outfit will not solve the problem. According to the lawyer the new owner will have to deal with the exact same criminal procedure. The advantage however, to this arrangement, would be that Ladbrokes would acquire an interesting and useful defense through the separation of the two corporate identities of the two companies.
The need for this arrangement came about because of the passage of anti-gambling legislation last summer in the United States, the restriction against financial transactions regarding online gambling. This has required that many gambling concerns have had to leave the United States market and this is particularly the case as regards the public sector.
As one of the analysts has explained it, with the proposed arrangement, Ladbrokes is now able to eat its cake and have it as well.
But according to the news articles, the Ladbroke’s board non-executive directors have been putting a hold on the deal for several wks due to their demands to examine each legal detail.
Last Friday the Ladbrokes shares closed at a record high.