GVC raises its bid for bwin.party

The bidding war for ownership of Bwin.Party Digital Entertainment continued Friday with a new offer from GVC Holdings plc as it attempts to beat rival 888 Holdings, the current favoured bid by the Bwin board of directors.

In its second raise in the last two weeks, GVC, backed by US private equity firm Cerberus Capital Management upped the ante with a revised bid worth GBP 1.03 billion ($1.6 billion) in cash and stock – slightly higher than its previous offer just short of GBP 1 billion.

Bwin’s directors have indicated that the 888 offer may be lower but is still more attractive, claiming that GVC’s offer is too complex and has fewer attractive growth prospects.

Analysts were speculating Friday whether Bwin would use the revised offer to push up 888″s bid.

888 has promised cost benefits of at least $70 million per annum by the end of 2018, while GVC has promised benefits of more than $150 million per annum by the end of 2017.

GVC’s latest offer of 125.5 pence per Bwin share – 25 pence in cash and 0.231 of a new GVC share – is 2.4 percent higher than its July 27 offer. Since then GVC’s shares have risen about 1.5 percent.

On Friday the directors of Bwin.Party issued a statement confirming that it is working closely with GVC on the revised offer in order to properly evaluate it, but emphasised that there can at present be no certainty that the offer will develop into an agreement.

The statement noted: “Bwin.Party’s directors’ unanimous recommendation of 888 Holdings plc’s offer is unchanged by this announcement.”