Softbank Deal On Betfair Worth £355 Million

Published: Friday, April 14, 2006 Online-Casinos.com

SOFTBANK DEAL ON BETFAIR STOCK WORTH GBP 355 MILLION

Financial details of acquisition deal released

The acquisition of 23 percent of the stock of betting exchange group Betfair (see previous Online-Casinos.com & InfoPowa reports) cost Japanese technology and venture capital group Softbank GPB 355 million (US$ 622 million) according to figures released by the company this week.

Under the terms of the agreement, first signed in March, the deal effectively values the leading betting exchange at GBP 1.54 billon and sees many of the original investors cashing in a proportion of their equity holding. Earlier media reports suggested that founders Ed Wray and Andrew Black both cashed in 1 percent stakes in the firm, but together still retain a 26 percent stake.

Other investors include private equity groups JP Morgan Private Finance, UBS Capital, Benchmark Capital, LV Capital and Index Ventures.

According to last year's results, Betfair made an operating profit of GBP 22 million from the P2P betting activities of some 95,000 active users.

Betfair has additionally announced a deal with the British postal authorities which should make customer identity verification more convenient for British residents. The agreement enables customers to download a form, fill in the details and take it with their ID documents to any of the Post Office's 14,500 branches nationwide. Betfair will then receive electronic notice from the GPO of the customer's verified details.

Jon Cumberlege, Betfair's registration and payment director, said: "It is important that we know the identity of our customers as it supports our transparent business model. We hope that this agreement with the Post Office will make it as easy as possible for our customers to validate their details."