Ladbrokes to buy online casino 888 | IXGAMES
The two online gambling companies have been in talks for over a month and a source close to the situation said a deal could be struck as early as next week. An offer for 888 is expected to be pitched at between 140p and 145p a share, netting millions for the two sets of brothers who founded the internet poker and casino group. 
Aaron and Avi Shaked and Shay and Ron Ben-Yitzhak still own about two-thirds of 888 – worth over £300m. It is not known whether they will sell out completely or take a share in Ladbrokes. The acquisition would beef up Ladbrokes’ online gambling operation, increasing liquidity on its poker sites, while providing software capability that it currently outsources. Analysts have estimated cost savings could be as high as £30m. The bookie set its sights on 888 (down 2p at 1281/2p) after the sector was hammered by the US ban on online gambling – gatecrashing early takeover talks between 888 and PartyGaming (down 1/2p at 30p) 888, led by John Anderson, a former Ladbrokes director, has fared better than its rivals in the aftermath of the American clampdown because less than half of its revenues came from the States. Compare that with PartyGaming, which relies on the US for three-quarters of its sales. News that Rank (down 11p at 2551/2p) had sold off its Hard Rock Cafe chain raised speculation that Ladbrokes’ boss Chris Bell could turn his attention to the operator of Grosvenor Casinos once the 888 deal is signed. Ivor Jones, analyst at Panmure Gordon, said: ‘Post the (Hard Rock) disposal, the probability of Rank being taken over goes up.’ 
Ladbrokes (up 1p at 4013/4p) and William Hill (up 5p at 622p) are seen as the potential buyers because they have the scale to extract the maximum benefits from any deal. Bingo groups and bookies are being forced to consider consolidation because 2007 is forecast to be a tough year. There are no major sporting events and they face being hit with a big tax bill on gambling machines after this August’s introduction of the Amusement Machine Licence Duty.