General Betting
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Betfair set to apply to be listed on stock exchange
BY RACING POST STAFF 7:27AM 21 SEP 2010
BETFAIR on Tuesday announced that it will apply to be listed on the London Stock Exchange, a move which if successful could lead to the long awaited flotation of the exchange firm.
A press release on the company's website said: "Betfair today announces its intention to apply for admission to the premium listing segment of the Official List of the UKLA and to trading on the main market of the London Stock Exchange (‘‘Admission'') and to proceed with an initial public offering of Shares (‘‘the Offer''). Betfair does not intend to issue any new Shares as part of the Offer.
"Betfair has a track record of sustained revenue growth and profitability and has multiple opportunities to secure future growth based on its unique, disruptive exchange platform technology and leadership in a large and growing online sports betting market."
The flotation of the firm on the stock exchange has been long vaunted, with estimates placing the value of the company at £1.5 billion.
On the same press release, Betfair also announced its audited results for the year ending 30 April 2010, with group revenue increasing 13% to £340.9 million.
BY RACING POST STAFF 7:27AM 21 SEP 2010
BETFAIR on Tuesday announced that it will apply to be listed on the London Stock Exchange, a move which if successful could lead to the long awaited flotation of the exchange firm.
A press release on the company's website said: "Betfair today announces its intention to apply for admission to the premium listing segment of the Official List of the UKLA and to trading on the main market of the London Stock Exchange (‘‘Admission'') and to proceed with an initial public offering of Shares (‘‘the Offer''). Betfair does not intend to issue any new Shares as part of the Offer.
"Betfair has a track record of sustained revenue growth and profitability and has multiple opportunities to secure future growth based on its unique, disruptive exchange platform technology and leadership in a large and growing online sports betting market."
The flotation of the firm on the stock exchange has been long vaunted, with estimates placing the value of the company at £1.5 billion.
On the same press release, Betfair also announced its audited results for the year ending 30 April 2010, with group revenue increasing 13% to £340.9 million.
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Replies: 83
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Actual sharp revenu decline from the sports operation within 24 months of IPO.
Viable competitor and/or shutdown of Betfair's international operations within five years. |
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definitely not a strong buy. personally i'll be interested to see if they are still denying that they're considering an IPO on the forum chat tomorrow night.
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its in service announcements...
Today Betfair announced its intention to list on the London Stock Exchange and to proceed with an initial public offering of shares. A copy of this announcement is available on our corporate website (http://corporate.betfair.com/). |
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If you buy a company, say for £1 it's generally worth a pound, what's the point of that? Surely the only reason anybody buys a comapany is, they believe they can increase that companies revenue.
It seems to me there's only three ways Betfair can improve its profit margin. 1)lay off workers this would have the affect possibly of increasing the bottom line through being more efficient. 2) Attracting more customers, in order that their turnover increases. 3) Increasing their charges on existing customers. Laying off staff suggests that Betfair is over manned at the present time, is there any evidence of this, its unlikely to be bought by another exchange in order to benifit from the idea of an economy of scale. In my opinion increasing the profit margin by efficiencies is speculative. Increasing the customer base by signing up new members isn't going to be easy eather, if it were why isn't it simply being done by the present mob? Maybe I am stupid but to me the easiest way the new Betfair owners could increase their profit is to charge the present members of the exchange more to use the sites facilities. |
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4 key things i'd want to see to invest.
A look at the balance sheet. A thorough breakdown of customers, earnings (and costs) to enable one to predict future growth. The headline figures are next to useless imo. A thorough investigation of past, current and predicted regulatory issues throughout the world. A look at potential threats from competition. |
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and won't take them long to think of that, either
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If there's a pricing scheme that would make Betfair more profit then why haven't they done that already? Virtually every day you read someone moaning on here about how expensive Betfair is and that they're overcharging, and now you're arguing that they're charging less than they could and that they'd make more profit by increasing the cost to customers. They can't both be true.
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betfair sitting on 150 million in cash and no debtso betfair , as to WH and Lad which has no cash big debt
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On price hikes, Betfair tried to increase basic commission on some markets to 7% sometime back. It was too big a jump and failed to take off. If I was a shareholder I would be looking for small increases, such as an increase of 0.5% in commission. I don't think it would have any more affect on business than the introduction of the premium charge. People would moan but get on with it. It would hike profits by 10%.
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It would appear that circa 10% of the share capital will be sold, this small amount makes the offering unattractive from an investment perspective.
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Why would that make it unattractive Equimine?
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the statement says "at least" 10%. As someone else said , if they were selling a high % of shares then people would run to the hills.
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Hazel, where did you see at least 10%, the statement I have seen says about 10%.
The small offering (assuming 10%) means only a small percentage of the business being publicly tradeable, it is virtually impossible to have any influence or say with so few shares in the public domain and the possibility of making gains through matters such as takover speculation, or trading, are virtually zero. |
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If as nairda says they have £150m in cash then they don't need investment so it's all about cashing in. I agree with hazel. They have to be seen to maintain confidence in the company's future prospects.
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it would surprise me if this turned out to be a good thing for customers thats for sure,as they would want to take even more of the pie for themself.
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equimine,co.uk i read it on
http://corporate.betfair.com/media/press-releases/2010/2010-09-21.aspx -- in particular the paragraph "details of the offer" |
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http://corporate.betfair.com/media/press-releases/2010/2010-09-21.aspx
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sorry equimine it wont let me post the link, but its on betfair corporate press release
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14 shareholders hold about 75% of shers, they are the only sharesholders ask to sell there shares, it doesn't mean the other 600 sharesholders who own the other 25% will not sell there shares on opening day..i believe there will be number of small shareholders sell there shares as those shareholders have never got any of the profits that befair over the last 10 years
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betfair has always use cash to grow or buy, it never use debt...USA TVG , Timefroum and all the othere business that betfair has brought or started has been started with cash and not debt...betfair doesn't need cash, the stock market listen is just a way for the small shareholders to sell out
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Its my belief CALCULATOR that in the near monopoly position that Betfair occupies(no other exchange can seriously hope to compete with Betfairs liquidity at the present time and quite likely will never able to do so) charges can and will go up.
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Those 600 small shareholders will get an average of £625k at £1.5bn. I wouldn't be gambling that amount of money by hanging onto them. As an investor I'd want at least a portfolio of 20 shares to spread the risk. It should be a complete no brainer to sell unless they have substantial personal wealth.
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Not forgiving tax issues. I'd obviously retain some shares to take advantage of capital gains allowances in future years. The bulk would definitely be sold though if it was me.
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Businesses float to give their early investors and founders an exit. I wd guess that Messrs Black and Wray want to crystallise some of their wealth and Softbank also want the option of crystallising their loss (?).
Bf shd dominate the world but 1) regulators and Treasuries everywhere wd have to accept a smaller income from gambling and more gambling in their population, given that the exchange model is high turnover and low margin, and 2) bf wd have to compete with incumbent totes and bookmakers more directly. At the moment it offers a complementary service to them. |
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Valuation a bit optimistic. Expect the 1.5 bil to reassessed close to float.
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askari1 is right..this stock market listing, is just to put a value on betfair, and to let the small shareholders a chance to sell there betfair share if they wish....as it sounds now, it very hard for the small sharesholder to sell there shares...
Also about 2 years ago, betfair did a share buy back of about 10% of betafir shares...so softbank will still make money if there was a value of 1.5 bil |
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The "regulatory risk" section will make interesting reading in the prospectus, IMO.
Its all about US expansion for me and your view on that determines with whether its a buy or not. |
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States like Kentucky w/ bloodstock industries will not want lose control of the share of punters' stakes they can cream off in takeout.
In one way, it cd be Australia ten times over for bf. |
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I read an interesting article yesterday about bf's potential for take over by BWin, it had very solid foundation with the likelyhodd of the bookies wanting to own the technology that bf now posses.
Although I dont know what the bookies would do with the exchange medium, it isnt a pretty thought imo. |
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Based upon the very limited information currently available for both the IPO and Betfair accounts (without downloading from Companies House) there are three points that would deter me:
1: The lack of liquidity in the shares with only 10% ish being available. I understand the comments concerning confidence etc. but something like 20% to 25% would be ideal. 2: The 1.5 Billion valuation seems high for a company with a "Tangible Net Worth" of approximately £88 million. 3: The valuation again seems high for a company that in 2010 made, it would appear, 28% of their pre tax profit from interest on either their, or customer, funds on deposit. Not their core business activities. |
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The 10% could actually be nearer 50% (although unlikely) as it only represents the amount that bert and that ed are putting up. It says nothing of the other parties who would be free to put all of theirs up, which I think could potentially mean 60% of the business.
The 10% on reflection is likely to be a 'manipulative' measure to measure demand by limiting supply. (thats as long as the rest dont decide to jump ship ofc) The valuation is too high imo too. The problem is tho that technology firms often take this kind of shape and are therefore high risk, theres very little to gain in these shores now without revolutionizing the 'unfair' aspects which they profit from which is therefore a double edged sword. There is bound to be interest in these shares for a number of reasons that I wont go into, I will be having some but drastically fewer than planned. |
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dbin,
I thought Black & Wray had indicated that they intend to sell approximately 10 per cent. of their holdings in the Company. |
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Yes they did, but they only hold 50% in total I believe so it gives no indication to what the rest will be doing
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Although the way I read it was that directors have limitations on the number of shares offered initially, and the directors must likely be the biggest share of the rest so its very unlikely that the majority would be put up to start with.
The point is though there has to be a reasonable amount of ppl who have simply been waiting for this opportunity to sell. |
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No shares for us small guys
 http://bit.ly/bHsV0d |
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Look to see a bookie in charge within 18 months deffo imo
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dustybin Joined: 29 Dec 08
Replies: 1569 22 Sep 10 09:08 I read an interesting article yesterday about bf's potential for take over by BWin, it had very solid foundation with the likelyhodd of the bookies wanting to own the technology that bf now posses. Although I dont know what the bookies would do with the exchange medium, it isnt a pretty thought imo. There is already at least one precident for this (Mansion) they decided it was best to shut it down and milk the mugs for themselves. |
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The £88.5m tangible net worth was a figure I was interested in seeing. Although their headline figures are well down I think the business looks in better shape than it was 12 months ago.
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If a bookie did 'acquire' the exchange Id imagine some kind of hybrid or worse...a more scrupulous activity that used the data they hold to do what winners were doing.
In either case Id hope if that occurred everyone would just jump to the next exchange |