888 insists Ladbrokes talks still on

By The Newsroom
Published 6th Feb 2011, 20:52 BST
Updated 7th Feb 2011, 20:37 BST
Online gaming firm 888 yesterday insisted a takeover by Ladbrokes was "not off the table" after reporting a rise in fourth-quarter revenue.

Quashing rumours that the talks had stalled, chief executive Gigi Levy said: "There is still interest on both sides in doing a deal. Every big deal has complexities, but there's nothing which is a big sticking point.

"There's a variety of things (to negotiate] like in any deal. We're trying to see whether we can tackle them or not."

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Ladbrokes declined to comment on the talks. Internet casino, poker and bingo business 888, which also provides gaming software to companies, said operating income rose to $71 million (45m) in the fourth quarter of 2011, up 18 per cent on Q3.

The performance was boosted by a turnaround in the performance of its poker business following a relaunch in the summer and earnings from Wink Bingo, acquired by 888 in late 2009. However, Wink's success means 888 is now liable to pay the vendors a deferred consideration.

Numis analyst Ivor Jones said that payment was likely to be around 45m, exceeding 888's cash resources., and the company was in "advanced discussions" to restructure the payment.

Nick Batram, analyst at Peel Hunt, said: "888 does look a reasonable consolidation candidate, but we don't believe the group is in a position to maximise value."

888's shares closed up 0.75p at 44.5p.