Empire Online admits £790 million approach, says talks at early stage |
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Sun, 04 Sep 2005 16:05
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LONDON - Internet gaming services firm Empire Online Ltd yesterday admitted that it had indeed been approached by a bidder and is in takeover talks with the said company. However, Empire did not reveal the identity of this mystery bidder, but analysts say that online betting group Sportingbet is the interested party.
"Empire notes the recent movement in its share price and announces that it has received an approach from a party interested in merging its business with that of Empire Online. The approach is subject to a number of pre-conditions, including completion of satisfactory due diligence. The board of Empire Online has commenced discussions with the interested party but these discussions are at an extremely early stage and there can be no guarantee that an offer will be made for the company at 270p a share or at all," the group said in a statement as shares continued to soar.
Numis, the Aim-listed broker is advising Empire in these talks. It may be recalled that Numis had also handled the floatation of the company around three months ago.
Analysts had speculated that Empire's rival PartyGaming was the bidder since it made business sense to integrate both companies. However, Saturday's Financial Times said that it was Sportingbet and not PartyGaming that was in talks with Empire. The story was unsourced meaning that the pendulum could swing either way as Empire has declined to clarify. Israeli businessman Noam Lanir, who founded Empire in 1998, is reportedly interested in the deal though there has been no confirmation about these rumors.
Analysts say that if Sportingbet were to succeed in winning Empire, PartyGaming stands to lose its customer-base by a sizeable number. Greg Feehely, an analyst at Altium Securities said, "Sportingbet is an acquirer of businesses. If they were the bidder it would beg the question of why they didn't buy Empire before it floated. Couldn't they have bought it cheaper?"
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