€1.4bn Paddy Power eyes up a chunk of €250m UK Tote
Paddy Power, the €1.4bn listed bookmaker, is believed to be eyeing up parts of the €250m British Tote betting organisation, which is due to be privatised.
The bookie, headed up by Patrick Kennedy, is thought to be primarily interested in buying a chunk of the Tote's 520 shops across the UK.
Paddy Power has 121 shops in the UK and has indicated that it would like to double that over the next two years.
Other potential bidders are thought to include Betfred and a group of private-equity players.
Sources indicate that Paddy Power's strategy would be to try to 'cherry-pick' the top 100 or so shops from the buyer of the Tote, which is split between betting shops and a pools business. It has no interest in the pools operations.
Paddy Power has plenty of firepower for an acquisition and has a track record of negotiating highly innovative deals.
Last year, it entered the Australian market, buying a 51 per cent stake in online gaming group Sportsbet. Buying the remaining stake could cost as much as €140m.
The British Tote was put up for sale in 2008, with a price tag approaching €350m. However the economic carnage saw the sale pulled. In recent weeks, the British government has reignited the sales process as part of its policy of selling off certain state assets.
Last Friday, Paddy Power's share price hit an all-time high of €30.20, pushing it past peaks last seen before the stock markets crashed in 2007.