Shares in Sportingbet plc have slumped more than 20 per cent in London this afternoon after the company confirmed that highly preliminary discussions regarding a potential acquisition of the company by Ladbrokes have been terminated.
The Boards of Sportingbet and Ladbrokes agreed to end discussions as the parties were unable to agree either a suitable structure or one that delivered sufficient value to shareholders in a meaningful timeframe.
In a statement to the London Stock Exchange on Monday, Ladbrokes CEO Richard Glynn said that the termination of the talks reflected the company’s attempts to accelerate growth but “without exposure to non mitigatable regulatory liability.”
“In August of last year we laid out a very clear organic strategy and investment programme for the reinvigoration of Ladbrokes,” said Glynn. “We were also clear on the intention to explore opportunities which enabled us to accelerate our progress that enhanced shareholder value and without exposure to non mitigatable regulatory liability.
“The potential benefits and risks associated with a combination with Sportingbet were clear to us from the outset and have been well covered by the market. Having completed our analysis we have been unable to agree a structure which delivers increased shareholder value within an acceptable regulatory environment. We have therefore agreed to end our discussions.
“Throughout this process we have remained fully focused on the execution of our organic strategy and continue to make good progress in its implementation, which remains on track. We are confident this plan will deliver significant value to our shareholders and we will continue to take a disciplined approach over potential opportunities to accelerate it."
In a statement, Sportingbet confirmed that it is currently not in discussions with any other party regarding a potential offer for the company.
“As stated in the company's final results announcement last week, the Board of Sportingbet remains focussed on its overall strategy of providing a first class sports betting product and of increasing its exposure to regulated markets,” said Andrew McIver, Sportingbet’s group chief executive. “The Board remains highly confident of Sportingbet's prospects as an independent company.”
The company said that discussions are progressing with GVC Holdings plc regarding a possible disposal of its Turkish language website, with a further update on to be provided when appropriate.
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