THE buy-out group behind Formula 1 motor racing has confirmed it is considering a bid for gambling website Betfair.
CVC Capital Partners said it has held talks with other investors, including Betfair shareholder and entrepreneur Richard Koch, pictured, about a possible joint approach for the online betting exchange.
Shares in Betfair closed up 11.8 per cent at 782p, giving the firm a market value of about £810 million, but the company urged investors to do nothing and insisted its recently-revamped strategy will pay off.
The group was worth about £1.4 billion when it floated on the London Stock Exchange in 2010, but has lost ground to competitors in recent years.
CVC said it has held preliminary discussions with Koch, private equity investor Antony Ball and other partners about its options for Betfair.
Former management consultant Koch has 6.5 per cent of Betfair’s shares and according to his website “made a fortune” from private equity investments including Filofax and Plymouth Gin.
Ball is a non-executive director of Luxembourg-listed investment firm Brait, which backed the buyout of frozen food chain Iceland in 2012.
CVC said its options “could include an offer for Betfair by funds advised by CVC together with Richard Koch, Antony Ball and partners”.
CVC added there is no certainty it will make an offer.
Betfair’s betting exchange works by matching punters and allowing them to bet against each other, which it says eliminates the need for a traditional bookmaker. The company says it processes seven million transactions a day.
CVC owns luggage firm Samsonite and also has stakes in Brit Insurance and theme park giant Merlin Entertainments.