Betfair Shares Start Off Strong
Betfair’s listing on the London Stock Exchange this past Thursday started off with a bang. The company’s shares rose almost 20pc the very first day of trading.
The 10-year-old company and world’s largest betting exchange is valued at £1.6billion, while co-founders Edward Wray and Andrew Black stand to make £18.9m and £16.6m, respectively, from the flotation.
"Betfair could be just what the doctor ordered for the UK's IPO market, which badly needs a dose of confidence," David Wilkinson, IPO leader at Ernst & Young in the UK, told the London Telegraph. "The pipeline of companies looking to float remains strong, but many UK companies are holding back until volatility reduces and valuations improve. The surge of IPOs everyone is waiting for is unlikely to appear until mid-2011 and 2012."
The company is expected to offer shares at between 11 pounds and 14 pounds each.
Betfair differentiates itself from the typical bookmaker model by allowing gamblers to bet at odds set by other members rather than by a bookmaker. It claims to have over 4,000,000 clients and a turnover in excess of £50m/week.
“We have many opportunities to grow our leading position in the online sports betting and gaming market,” Chief Executive Officer David Yu said in the statement. “We are extremely pleased that new investors share our enthusiasm for the future of the business.”
- Aaron Goldstein, Gambling911.com
