Newspaper article The Evening Standard (London, England)

Hilton Gets Lift from Ladbrokes Bid Talk; MARKET REPORT

Newspaper article The Evening Standard (London, England)

Hilton Gets Lift from Ladbrokes Bid Talk; MARKET REPORT

Article excerpt


INVESTORS were betting on shares in Hilton Group today after the hotelier and gambling outfit said it had received interest for its Ladbrokes bookies arm from a number of potential bidders.

Since Hilton announced plans to sell its hotel assets to US affiliate Hilton Hotels Corp for [pounds sterling]3.3 billion, it has received a host of approaches from buyout specialists offering up to [pounds sterling]3.7 billion for Ladbrokes. The prospect of an auction lifted Hilton 91/2p to 376p.

It had to issue a statement today after a report that venture capitalist CVC had put forward a fully financed takeover offer. Hilton said the CVC approach, like all the others it has received, was full of preconditions, making it unsuitable to consider.

There are currently no talks with any bidders. Instead, Hilton plans to retain Ladbrokes' status as a quoted company. It is close to finalising how the business will be financed and structured, and will announce details on 23 February.

CVC's interest, which emerged early last month, is little surprise.

It made enormous profits from the flotation of William Hill in 2002 and was an underbidder for Coral Eurobet last year.

Other venture capitalists known to be interested include US buyout giants Kohlberg Kravis Roberts and Blackstone, as well as pan-European group BC Partners. Gambling is a popular sector for private equity, particularly since Charterhouse Capital made millions of pounds from the sale of Coral to Gala, itself owned by venture capitalists.

The rest of the market failed to take up the baton offered by Wall Street, where share prices posted useful gains overnight. Instead, blue-chips gave back some of yesterday's gains, leaving the FTSE 100 index down 13.7 at 5787.9.

The flurry of bid speculation in Lloyds TSB boiled over, the shares slipping back 6p to 529p They were driven 6% higher yesterday by talk of a bid from by one of its big European or US rivals. Word is broker Dresdner Kleinwort Wasserstein has downgraded the shares.

Heavy turnover was recorded in ailing retailer Woolworths, with more than 115 million shares changing hands as the price marked time at 311/2p. …

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