Who could buy Bet365? Bankers salivate, but a takeover is tricky

Times

04-05-2025

It takes a lot to surprise London's investment bankers. But reports last week that Bet365, the self-styled 'largest mobile sports wagering brand in the world' was up for sale, blindsided the great and the good of the City.
'My phone has not stopped ringing about it,' said one seasoned betting sector banker. 'But I knew nothing about it beforehand.'
The news that founder Denise Coates, Britain's richest woman and the country's biggest taxpayer, was looking to cash in her chips, left deal-hungry advisers with dollar signs in their eyes.
Reports were that Coates, whose family fortune is estimated to be nearly £7.5 billion, according to The Sunday Times Rich List, had invited advisers to pitch for overseeing either a sale of the Stoke-on-Trent-based business and/or a stock market float. The business could be worth £9 billion, according to The Guardian.
A deal of that size would most likely involve the investment banking titans of Wall Street. Yet for whatever reason, some of them had not been invited to pitch for Bet365.
JP Morgan was completely unaware that Coates had launched a 'beauty parade' as it is known in financial circles, according to City sources. American counterpart Jefferies is understood to have been similarly snubbed.
That a sale is now on the cards should not come as a complete surprise. Bet365 announced in March that it was exiting remote gambling operations in China, where digital wagering is illegal and people could face a prison sentence if caught.
Bet365 has historically had a sizeable remote operation in the country, so the decision to exit was seen as a watershed moment that some interpreted as a preamble to a potential sale, as reported by The Sunday Times in March.
Selling up now makes sense in many ways. The company has had moderate success in the US, where a decades-long ban on sports wagering is being repealed on a state-by-state basis. In the years to come, America will be the world's biggest regulated sports betting market.
Paul Leyland of independent consultancy Regulus Partners said: 'She has built an amazing company, but the complexity of gambling now is that you have to think like a group. Running a group of companies is very different to a company where you have your team around you.
'While she still has the US growth story coming through; while there is still appetite for the sector because nothing truly terrible has blown up… Maybe now is the time.'
But a sale risks bringing Coates into conflict with the very things that she treasures the most: her personal privacy, and that of the company that she started from a Portakabin in a Stoke car park in 2000.
Coates could well shield herself from the limelight on a personal level. But any corporate transaction involving Bet365 is likely to involve a protracted and complicated due diligence process.
Aged 57, Coates has no natural family successor, according to those with knowledge of how the company works. 'It's not like there is a 35-year-old Harvard Business School-educated son or daughter already working in the business and ready to take over,' said one source.
Accordingly a sale may be her only option, if Coates does wish to tap out.
But even so, the population of potential buyers is far from vast. In part this is because betting sector investments are excluded on ethical grounds by many funds. Similarly some bankers, such as Royal Bank of Canada, are not even allowed to advise on gambling sector transactions.
Private equity Apollo, CVC Capital, and Blackstone are likely to be the only funds with the combination the firepower and mandate to buy either all or part of Bet365. They all declined to comment on whether they were interested in a putative bid for Bet365.
Listed suitors are similarly limited. FTSE 100 firm Entain and former counterpart Flutter would most likely be excluded on antitrust grounds.
So perhaps the only public company that could swoop is the US-listed DraftKings — but this is a company that is comparatively cash poor. A DraftKings takeover would undoubtedly involve the Coates family having to take the US firm's shares in part or full payment.
Bet365 declined to comment on reports of a sale this weekend. As for its next steps — all bets appear to be off.