Betfair considers £1.5bn flotation

Gaming giant Betfair is considering a potential £1.5bn (€1.72bn) flotation amid discussions over the future of the firm, it was reported today.

Gaming giant Betfair is considering a potential £1.5bn (€1.72bn) flotation amid discussions over the future of the firm, it was reported today.

Founders Andrew 'Bertie' Black and Ed Wray have agreed for meetings with banking advisers over the possibility of a flotation as Betfair looks to raise capital in a bid to lead the consolidation of the global gambling industry, according to The Sunday Telegraph.

A spokesman for Betfair has described the report as speculation and said he could not comment further.

If the listing went ahead it would be the UK's first major flotation since the onset of the financial crisis.

Betfair group, which incorporates the world's largest gaming exchange, is thought to have the move on the table despite saying earlier this month that it was not heading in that direction after its founders reconsidered their position in the face of strengthening stock markets.

Mr Black and Mr Wray are understood to own a combined 25% stake in the firm and a listing could land the pair with a potential payout worth hundreds of millions of pounds, the report said.

It is believed they are each worth about £190m (€218.79m) but could scoop a further £350m (€403m) or more between them if they were to sell their stakes in the company.

Other Betfair shareholders include Japanese bank Softbank, which is thought to be keen to get a return on its 23% holding in the company.

The report said Softbank bought its stake in a £355m (€408.8m) deal in April 2006, valuing the firm at £1.5bn (€1.72bn).

It is thought the reduction in equity market valuations in the wake of the financial crisis means the stake would be likely to be valued at a similar level to three years ago, despite Betfair's strong progress in the period.

The report added that while a flotation was the most likely way for Betfair to raise capital, it could also choose to tap shareholders for further funding.

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