Coral seriously preparing for £800 million flotation |
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Published
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Mon, 01 Aug 2005 03:35
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Britain’s third-biggest bookmaker, Coral Eurobet is preparing to launch an £800 million flotation and is engaged in extensive talks with an investment bank to sort out the details of the same.
Lehman Brothers are advising Coral on this particular venture according to The Sunday Times.
Charterhouse, the private-equity firm, which had purchased Coral in September 2002 for £860 million, owns 84 percent of the bookmaker while the management including chief executive Vaughn Ashdown and finance director Mick Mariscotti hold the remaining 16 percent of the firm. This works out to about £128 million at the current valuation of Coral.
The company operates around 1,260 betting shops in the UK and if the flotation does become a reality would join online poker groups Party Gaming and Empire Online as the three UK firms to be listed on the stock market.
Analysts say that that management has to be in favor of the flotation as a direct buyout is estimated to be worth somewhere in the region of £2 billion out of which £800 million would be set aside for the equity and remaining £1.2 billion would take care of Coral's outstanding debts. Analysts doubt if any buyer would be interested in pumping such a huge amount into the group. However, the management has not ruled out a direct buyout option.
Since 2002, Coral has moved on rapidly and has made almost £145 million operating profits on the estimated sales of £5.4 billion. Besides, the company runs a very successful Eurobet website. It has also moved in to cash on the rising popularity of online poker. Coral, which was founded in 1926 by Joe Coral, is well placed to make many more acquisitions and a flotation is a perfect platform from which the company can build on.
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