Betfair To Go To Japanese Investors

Published: Tuesday, February 28, 2006 Online-Casinos.com

MAJOR CHUNK OF BETFAIR TO GO TO JAPANESE INVESTORS

Softbank deal could see up to 23 percent of betting exchange group change hands

Making headlines in the industry business press this week is the news that Betfair's parent company and principle shareholder, Sporting Exchange Limited has signed a deal with the Japanese investment bank Softbank Corporation that could see a large chunk of the company change hands.

Initial reports on the agreement say that up to 23 percent of the British online gambling group Sporting Exchange Limited could be involved.

A spokesman for Sporting Exchange, parent company of the Betfair online exchange betting service, would not say how much the deal was worth, but promised more detail soon. However, the Financial Times newspaper said Softbank is to pay GBP 13 a share, valuing the British company at around GBP 1.5 billion.

In its latest business initiative, UK-based Betfair began operations in Australia earlier this month to fight for a share of Australia's A$2.5 billion betting market in a 50-50 joint venture with James Packer's Publishing and Broadcasting Ltd.

Betfair is a global internet betting exchange which allows gamblers to bet against each other. It makes money by taking a commission on each bet.

Spokesmen for Sporting Exchange said the firm's directors had signed an agreement to sell between 15 percent and 20 percent of its shares to Softbank. The deal, expected to be completed around April 3, would give Softbank a further 3 percent of Sporting Exchange's primary shares.

"Softbank is the ideal strategic partner for Betfair's ambitious expansion plans," a spokesman for Betfair in London said.

Late last year, Betfair ruled out a London IPO following media speculation which UK newspapers said could value the British group at up to GBP 1 billion.

Softbank has a broad portfolio of internet, finance and publishing businesses. Earlier this month, it posted a group operating profit of Yen 23.5 billion for October-December, compared with a loss of Yen 7.5 billion in the same period a year earlier.