Betfair unveils stock market plan
Online sports betting firm Betfair today fired the starting gun on a flotation expected to value the firm at around £1.5bn (€1.8bn).
The planned listing on the London Stock Exchange will enable founders Ed Wray and Andrew Black to sell some of their holdings in the company. They launched the business 11 years ago and own a combined 24pc stake in the firm.
The flotation, which has been the subject of City speculation for some time, is expected to earn Betfair a place in the FTSE 250 Index if it goes ahead.
A number of companies have struggled with flotations this year, with online grocery firm Ocado seeing its share price dive following its stock market debut, despite slashing the price of the shares for the initial public offering (IPO).
Betfair, which has yet to provide pricing details for the offer, said it expected around 10pc of the company to be sold by a number of its major shareholders.
There are 14 major investors holding 75pc of the company and Betfair said more than half of this group were likely to participate in the share sale.
A further 600 shareholders, who own around 25pc of the company, will also be given the opportunity to sell stock. No new shares will be issued in the offer.
Mr Wray, who with Mr Black will sell around 10pc of his holding, said the announcement represented a landmark in Betfair's history.
He added: "Becoming a publicly listed company will provide Betfair with the heightened profile and enhanced transparency that will help us cement our long-term relationships with customers, regulators and business partners around the world."
Betfair claims to be Europe's largest online sports betting operator, with 2.5 million registered users.
It acts as a betting exchange, matching individual betters to each other. Users can choose the odds at which they want to place a bet, while they can also bet both that an outcome will happen and that it will not happen.
The group, which is licensed to operate in the UK, Australia, Malta, Italy, Austria and Germany, also announced today that revenues grew 13pc to £340.9m in the year to April 30, although pre-tax profits fell to £17.8m from £47.5m as a result of planned investment in the business.