Betfair shares surge on CVC takeover talk

Betfair Group

Last Updated at 22 Aug 2014, 11:30 ET *Chart shows local time Betfair Group intraday chart
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CVC Capital, the private equity firm that owns Formula One, has held talks about making a takeover offer for online betting exchange Betfair.

Following reports over the weekend, CVC said in a statement on Monday that it had held preliminary talks with other investors about a possible joint bid.

Shares in Betfair, whose betting exchange allows gamblers to bet against each other, rose as much as 14%.

In a short statement, Betfair said it was focused on running the business.

CVC's statement said it had held preliminary discussions with investors Richard Koch, Antony Ball and others about a takeover approach.

Mr Koch, a co-founder of LEK Consulting, holds a 6.5% stake in Betfair. Mr Ball is a non-executive director at Luxembourg-listed investment group Brait.

CVC said: "CVC keeps a wide range of opportunities under regular review, and confirms that it has had preliminary discussions with Richard Koch, Antony Ball and partners regarding options in respect of Betfair, which could include an offer for Betfair by funds advised by CVC together with Richard Koch, Antony Ball and partners."

However, CVC added that there was no certainty it would make a formal bid.

Gerald Corbett, chairman of Betfair, advised shareholders to sit tight and take no action.

In a statement, he said: "With our new team now in place and the announcement of a more focused strategy in December, I believe Betfair is currently going through one of the most exciting phases in its development.

"Our management team is actively implementing the new business plan for the company and we remain fully committed to delivering on the new strategy and providing improved returns for our shareholders."

Betfair's exchange processes more than seven million transactions a day.

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