Private equity giant CVC has pulled the plug on a €1bn-plus takeover attempt for UK betting exchange Betfair, which is headed by former Paddy Power executive Breon Corcoran (pictured).
Shares in Betfair plunged over 8pc on confirmation from CVC that it's no longer pursuing the takeover effort. The stock later recovered, but had still shed 3.3pc by day's end to close at £8.65.
CVC and two other principals, including an existing Betfair shareholder, Richard Koch, had made a tilt at Betfair. Their initial indicative offer of £8.80 per share had been rejected by Betfair, which said it undervalued the company.
Betfair said that last Friday it received a revised indicative offer of £9.20 per share.
"The board reviewed the revised proposal with its advisers and rejected it," said the company. It said its chairman, Gerald Corbett, told CVC and its partners that the proposal had been rebuffed and asked if any further, revised proposal would be forthcoming.
On Sunday, a revised "full and final offer" of £9.50 was received. That was also rejected by the Betfair board on the basis that it undervalued its "attractive prospects". Further discussions then took place with CVC regarding its proposed business plan for Betfair. It's believed Betfair had been seeking more than £10 per share.
"During these discussions it became clear that it would not be possible to agree the terms of any proposal in conjunction with a business plan that was deliverable," said Betfair. It added that the discussions were terminated and CVC and its co-offerors signalled they wouldn't be making any formal offer to buy Betfair.
Mr Corbett said the Betfair board had spent "considerable time" assessing the proposals.
"Under the new direction of Breon Corcoran and his management team the board believes that Betfair is making excellent progress in the implementation of its strategy with momentum building from early success," he added.