Betfair wagers on Freshfields as £910m CVC takeover bid snubbed

Freshfields Bruckhaus Deringer has won the lead role acting for Betfair in relation to a £910m takeover bid from private equity group CVC Capital Partners.


Martin Taylor
Martin Taylor

Betfair announced on Monday (22 April) that it had rejected CVC’s preliminary 880p per share offer for the FTSE 250 gambling company after receiving the proposal on 19 April. Betfair said its board felt the bid “fundamentally undervalues the company and its attractive prospects”.

Freshfields corporate partners Martin Taylor and Ben Spiers are advising longstanding client Betfair alongside lead associate Alison Smith.

CVC’s legal advisers are unconfirmed but the group is understood to have instructed Clifford Chance. Clifford Chance corporate partner Kem Ihenacho, who led alongside fellow partner Patrick Sarch on CVC’s takeover of Brit Insurance in 2010 (26 October 2010), declined to comment.

CVC confirmed on 15 April that it was in preliminary discussions with Betfair shareholders Richard Koch and Antony Ball about options including a possible offer for the business.

The London and Luxembourg-based buyout group is reportedly planning to continue eyeing a bid for Betfair but has not formally tabled a revised offer.

Betfair chairman Gerald Corbett said in a statement: “We have a unique business with a market position, profitability, cash flow and prospects that this proposal fails to recognise. Our new management team are implementing the strategy announced in December 2012 and it is this that will realise value for shareholders.

“We will provide an update to the market on 7 May to set out the good progress we are making in the implementation of our strategy, including cost efficiencies, and our recent trading performance.”

Background to this deal:

Freshfields’ Taylor advised Betfair on its IPO in 2010. The firm also acts for gaming clients including Betfred, Bwin.Party and 888.

CVC has a longstanding relationship with Clifford Chance, with David Pearson acting as its relationship partner following the retirement of longstanding adviser James Baird in 2011, but the private equity client has gradually shifted towards a two-firm strategy in the City consisting of Clifford Chance and Freshfields, where its relationship partner is Christopher Bown.

CVC last week announced the €3.1bn acquisition of a majority stake in German energy metering group Ista, instructing German domestic leader Hengeler Mueller (19 April 2013). Freshfields advised sellers Charterhouse Capital Partners.

CVC also owns Formula One, which it bought in 2005 under advice from Freshfields. It then sold a proportion of its stake in the motor racing group last year, hiring Bown (23 May 2012).

For more on CVC’s relationship with Clifford Chance and Freshfields, see City analysis

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