London-listed GVC Holdings has confirmed that it is preparing to resubmit its proposal to acquire bwin.party digital entertainment following discussions with the Gibraltar-licensed operator, but will not increase its bid for the company as was widely expected.
The Isle of Man licensee made an offer for the entire issued and to-be-issued share capital of bwin.party of 25 pence in cash and 0.231 new GVC ordinary shares earlier this month on August 7th.
That proposal valued bwin.party at approximately 124 pence per share, based on GVC’s closing mid-market price on August 21st of 427 pence per share. The 124 pence bid price is the second to be submitted after GVC's initial 110 pence per share bid back in July.
Despite 888’s 104.09 pence per share offer being significantly lower that each of GVC’s bids, bwin.party’s board has unanimously recommended the 888 bid, noting that it offered a higher degree of certainty for shareholders and greater synergies between the companies’ offerings.
There was increased speculation last week that GVC would raise its bid to around 130 pence per share, valuing bwin.party at around £1.1bn, but the company's announcement this morning only reaffirms its most recent bid.
The company confirmed that it continues to work closely with bwin.party and its advisers with a view to finalising the open aspects of its proposal.
“Significant progress has been made and the GVC board expects to be in a position to resubmit its proposal to the bwin.party board in the near future and on the same terms as set out in the August 7th 2015 announcement, having resolved the remaining open issues to both parties' satisfaction,” GVC explained.
“There can be no certainty that an offer for bwin.party will be made by the company,” GVC added.
bwin.party also reiterated that there was no guarantee GVC will make a firm offer, and again noted that its directors’ unanimous recommendation of 888’s offer remains unchanged.
Shares in bwin.party digital entertainment plc (Co.Data) (LSE:BPTY) were trading at 114.30 pence per share in London this morning, while shares in GVC Holdings plc (Co.Data) (LSE:GVC) were currently trading down 0.47 per cent at 425 pence per share.