Ladbrokes makes a move for Sportingbet

A spokesperson for Sportingbet has confirmed that the company accepted an initial approach for potential purchase of Sportingbet from Ladbrokes, the UK-listed offline, online and telephone betting giant. It doesn’t seem that the approach has a formal fixed offer attached to it, but rather more a move planned to test the ground for potential acquisition negotiations.

The news of a potential big has caused a spike in Sportingbet share price making it rise by 4.9% to 42½ pence. It is rumored that Ladbrokes is planning on making a bid of 70 pence a share, which considering Sportingbet current share price seems like a tempting offer.

The Ladbrokes Group, spearheaded by CEO Richard Glynn continues in its attempts to grow its online business and make Ladbrokes online brands have a real presence in the e-gaming market.

Back in April we reported that merger talks between Ladbrokes and 888 broke down, only four months after they commenced. No official reason was provided by Ladbrokes at the time for deciding to terminate the talks, with Glynn commenting at the time that he saw little added value in merging with 888.

Sportingbet has also had its fair share of dissolved merger talks and drawn out acquisitions. Just last November merger talks with Unibet were called off after details of the talks were leaked to the media.

In addition this May Sportingbet agreed to buy Australian-based operator Centerbet and has since raised £130 million in sales of newly issued shares and convertible bonds. The deal is planned for completion around August 2011.

In case negotiations between Ladbrokes and Sportingbet progress nicely, Ladbrokes in expected to include Centerbet as part of its bid for Sportingbet.

A Ladbrokes spokesperson has stated that the company has a fixed strategy and is “continually looking at various opportunities, including Sportingbet, in order to accelerate that strategy.”