William Hill is considering a bid for London ClubsInternational.
The casino group has become a potential target after extricating itself from its obligations to Aladdin, the Las Vegas casino under bankruptcy protection.
The bookmaker held preliminary discussions two weeks ago with London Clubs – which has accumulated a Pounds 280m debt mountain through its Aladdin adventure – but no contact has been made since and no offer tabled.
William Hill could face competition from the LCI management, which is also thought to be considering taking the company private. Barry Hardy, chief operating officer, who has been the public face of the company since the resignation of Alan Goodenough as chief executive in August, is understood to be investigating the possibility of leading a management buy-out.
Mr Hardy knows the business well, having been with LCI for 12 years sbobet88 . He joined as finance director in 1989, three years before the casino group’s flotation.
The group is focused at the moment on talks with its banks – led by Bank of Nova Scotia – on restructuring its debt. LCI is believed to be considering raising funds through a sale and leaseback on the freehold of 50 St James, one of its London casinos, and of reducing its 70 per cent stake in its South Africa casino.
The group is also considering going to shareholders to raise money. These include Trevor Hemmings, the leisure entrepreneur who has a 10 per cent stake, and Resorts World, a Malaysian gaming group, which has 5 per cent.
William Hill is thought to be interested in LCI because liberalisation of Britain’s gambling laws is expected to increase gambling’s share of the leisure market.
A number of casino operators, including Stanley Leisure, Rank Group and Gala Group, have also been in contact with London Clubs to register their interest in buying some of its casinos.
None is thought to be interested in acquiring the whole business but discussions are under way between some of them about the possibility of a joint bid.
William Hill, the second-largest bookmaker after Ladbrokes, is owned by Cinven and CVC Capital.
They have postponed plans for a flotation, likely to have taken place in the first half of next year, partly because of the volatility in financial markets after September 11 but also because of a prolonged levy dispute with the horseracing industry.
Shares in LCI leapt 70 per cent to 30p on Monday but have fallen back during the week. They fell 1/4p to 26 1/4p.
Neither London Clubs nor William Hill would comment.
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