Five questions answered on Betfair’s rejection of CVC Capital’s takeover bid

CVC shot down.

Online gambling firm Betfair has rejected CVC Capital Partners’ take over bid. We answer five questions on why the company rejected the bid.

What offer did CVC Capital Partners make to Betfair?

CVC, which also owns Formula 1, made a preliminary bid of 880p per share to take over Betfair, offering the company around £912m in total.

Why did Betfair reject this bid?

According to The Telegraph, the company said in a statement released today that the offer “fundamentally undervalues the Company and its attractive prospects".

According to the market, how much is Betfair worth?

On Friday shares in Betfair closed at 805p, which values the business at about £834m.

What else has Betfair said?

Betfair's chairman, Gerald Corbett, speaking to The Telegraph, said: "We have a unique business with a market position, profitability, cash flow and prospects that this proposal fails to recognise.”

He added: "We will provide an update to the market on 7 May 2013 to set out the good progress we are making in the implementation of our strategy, including cost efficiencies, and our recent trading performance."

How well have Betfair done in recent years?

The company, which was founded in 2000 by Ed Wray – a former JP Morgan trader – and former professional gambler Andrew Black, has struggled over the last two-and-a-half years that it has been a public company.

Its shares fell dramatically from its IPO price of £13 a share, following an over-hyped flotation, and last December it announced it was pulling out of Russia and Canada because of their unclear gambling regulations, despite the fact the markets made up almost a quarter of the company’s revenue.

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Heidi Vella is a features writer for

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Is anyone prepared to solve the NHS funding crisis?

As long as the political taboo on raising taxes endures, the service will be in financial peril. 

It has long been clear that the NHS is in financial ill-health. But today's figures, conveniently delayed until after the Conservative conference, are still stunningly bad. The service ran a deficit of £930m between April and June (greater than the £820m recorded for the whole of the 2014/15 financial year) and is on course for a shortfall of at least £2bn this year - its worst position for a generation. 

Though often described as having been shielded from austerity, owing to its ring-fenced budget, the NHS is enduring the toughest spending settlement in its history. Since 1950, health spending has grown at an average annual rate of 4 per cent, but over the last parliament it rose by just 0.5 per cent. An ageing population, rising treatment costs and the social care crisis all mean that the NHS has to run merely to stand still. The Tories have pledged to provide £10bn more for the service but this still leaves £20bn of efficiency savings required. 

Speculation is now turning to whether George Osborne will provide an emergency injection of funds in the Autumn Statement on 25 November. But the long-term question is whether anyone is prepared to offer a sustainable solution to the crisis. Health experts argue that only a rise in general taxation (income tax, VAT, national insurance), patient charges or a hypothecated "health tax" will secure the future of a universal, high-quality service. But the political taboo against increasing taxes on all but the richest means no politician has ventured into this territory. Shadow health secretary Heidi Alexander has today called for the government to "find money urgently to get through the coming winter months". But the bigger question is whether, under Jeremy Corbyn, Labour is prepared to go beyond sticking-plaster solutions. 

George Eaton is political editor of the New Statesman.