American gambling giant increases bid for UK casino group

Casino operator London Clubs International was on the verge of American ownership today after Las Vegas gaming giant Harrah’s Entertainment upped its bid.

Harrah’s, the biggest casino operator in the world and owner of Caesars Palace in Las Vegas, increased its offer from 125p a share to 135p a share to value LCI at £302.2m (€451.2m).

Harrah’s also secured a 29.6% stake in LCI after it paid Malaysian gambling firm Genting International 135p a share, or £89.6m (€133.8m), for its holding.

It had been thought that Genting was preparing its own counter-bid to trump the Harrah’s offer but Harrah’s now looks certain to have won control.

LCI chairman Michael Beckett said: “We are delighted that Harrah’s and Genting have agreed terms as it removes the principal uncertainty for other LCI shareholders.

“There is a great fit between these two businesses and the logic for this deal is compelling for all LCI shareholders.”

Harrah’s is itself a takeover target after private equity firms Apollo Management and Texas Pacific Group lodged a $15bn (€22.4bn) bid.

If the proposed buyout of Harrah’s and the acquisition of LCI go ahead it would mark the first private equity involvement in the UK casino market.

LCI owns Fifty, The Rendezvous Casino, The Sportsman Casino and The Golden Nugget Casino in London as well as sites in Manchester, Leeds, Blackpool, Nottingham and Glasgow.

Harrah’s, which owns or manages 37 casinos under brands including Caesars and Horseshoe, has been looking to establish a presence in the UK for some time.

The deals for Harrah’s and LCI come at a time of upheaval for the gambling industry in the UK.

Liverpool-based Stanley Leisure has agreed to a £639m (€954.15m) takeover by Genting, and the online gaming industry faces a wave of consolidation in the wake of the US clampdown on internet gambling, which sparked a share price crash within the sector earlier this month.