Speculation mounts on Ladbrokes taking over 888.com

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888.COM TAKEOVER SPECULATION INCREASING

Weekend press reveals Ladbrokes strategy

Speculation in Britain on the possibility of Ladbrokes taking over the Gibraltar-based 888.com online gambling group went up a gear over the weekend with media reports on the British bookie's alleged strategy.

Sky TV and the Financial Mail on Sunday reported that Ladbrokes could avoid potential US legal action with a specially-tailored GBP440 million takeover plan for 888, in a strategy which would see it strip out the majority of the latter's assets, rather than acquiring the group as a whole.

The article quotes a lawyer as saying: "If a company faces criminal liabilities in the US, selling up is not the end of it. The new owner will face the same criminal proceedings. But this new structure could give Ladbrokes an interesting defence by separating the corporate identities of the two companies."

The situation has been brought about by last summer's US online gaming financial transactions crackdown, which forced a pull-out of many gaming firms, especially in the public sector.

One analyst pointed out that the proposed move could see Ladbrokes "...have their cake and eat it."

However, the paper says non-executive directors on the Ladbrokes board have been holding up the talks for weeks by their insistence on scrutinising every legal detail.

Ladbrokes shares closed at a record high on Friday.