Talks ongoing between Ladbrokes and 888

Internet gambling firm 888 Holdings yesterday said takeover talks with Ladbrokes were still ongoing as it bolstered its negotiating position with strong final-quarter sales.

The company, which offers casino, poker and sports betting, said an announcement regarding a potential deal with Ladbrokes would be made when appropriate – following reports that discussions had hit difficulties over the tabled price. 888, which recently launched an advertising campaign with former Australian international cricketer Shane Warne, posted an 18 per cent increase in operating income to US$71m (£44m) in the final quarter of 2010.

Bookmaker Ladbrokes revealed it was in talks to buy 888 in December, following reports it had offered £240m for the company.

Sign up to our Business newsletter

Sign up to our Business newsletter

Reports claimed the potential deal hit a stumbling block after 888 rejected the bid and Ladbrokes was unwilling to move any higher.

But after 888 revealed the talks were still ongoing shares edged ahead nearly two per cent to 44.5p, valuing the company at £153.7m. The company’s share price has lost 58 per cent of its value in the last year, as demand for online poker decreased and hit revenues and profits.

Chief executive Gigi Levy said: “We are very pleased with the results delivered during the last quarter of 2010 – especially the record 18 per cent quarterly sequential growth.

“Our marketing activities have driven record numbers of players to our sites, and growth was achieved across our business lines.”

The group said its strong fourth-quarter trading continued into 2011 with average daily revenues increasing by three per cent in January. Casino revenues were up 17 per cent, while bingo and poker were up 13 per cent and 28 per cent respectively.