Traders Expect Ladbrokes Bid For 888
888 Holdings, the online casino and poker company, closed at a record high yesterday on hopes that it could be a takeover target for Ladbrokes once the bookmaker has completed the £3.3bn sale of its Hilton hotels.
Chris Bell, the Ladbrokes chief executive, is determined to make the most of the company's independent status by expanding overseas and online, and traders reckon 888 could be a tempting target for the cash-generative bookie.
888 operates Casino-On-Net, one of the most popular online casino sites, and Pacific Poker, the fourth-biggest internet poker site. Around half its revenues come from the US and analysts note that its chief executive, John Anderson, was once a Ladbrokes employee.
On top of that, 888 appears to be one of the cheapest stocks in the sector, trading on a prospective price-earnings ratio of 14, according to stockbroker Killik & Co. 888 shares, which floated at 175p in September, closed 2.25p higher at 210.25p, valuing the FTSE 250 company at just over £700m.
