Betfair shares up 12% as CVC ponders $1.1b takeover bid

CVC Capital Partners, the private equity group that took a bath on its ownership of Nine Entertainment last year, is considering a takeover bid for gambling group Betfair - another venture associated with James Packer.

CVC Capital Partners, the private equity group that took a bath on its ownership of Nine Entertainment last year, is considering a takeover bid for gambling group Betfair - another venture associated with James Packer.

The British-listed shares of Betfair rose 12 per cent on Monday after CVC, which also owns Formula One racing, said it was in talks with a Betfair investor about making a bid for the group valued at £800 million ($1.1 billion).

CVC said it had "preliminary discussions with Richard Koch, Antony Ball and partners regarding options in respect of Betfair, which could include an offer for Betfair by funds advised by CVC together with Richard Koch, Antony Ball and partners". Mr Koch holds a 6.5 per cent stake in Betfair.

Betfair acts as an online exchange that allows punters to bet against each other, rather than against Betfair, which takes a cut of each transaction.

Betfair has disappointed as a listed stock following an over-hyped public offering 2½ years ago. Despite Monday's boost, the stock is still trading 40 per cent below its float price. Betfair's Australian operations are owned in a joint venture with Mr Packer's casino operator Crown Ltd.

Mr Packer sold most of Nine and its related assets to CVC Asia Pacific for about $5 billion in cash and debt in 2007.

CVC crystalised a loss of about $2 billion last year when it was forced to hand Nine to its creditors.

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