British broadcaster British Sky Broadcasting (Sky) on Friday made an offer to buy online sports content and gaming company 365 Media Group Plc for £96 million to strengthen its presence in the I-gaming sector.
Formerly ukbetting, 365 Media Group runs a network of sports information and gambling Web sites including Football365, sportinglife.com and totalbet.com, which reach over 9 million users each month and have over 60,000 betting and gaming customers.
The deal is still under consideration, but Robert Fraser, head of corporate press for Sky, said his company anticipates closing the deal "by the New Year."
Fraser could not comment on the specifics of the deal, but he confirmed that Sky would acquire all of 365 Media's properties and take over the operation of all of the company's sites. He added that the sites would continue to operate under their established names.
Sky said 365 Media's directors considered the terms to be fair and reasonable and intend to recommend that its shareholders accept the offer.
The offer is 68 pence in cash for each 365 Media share at approximately £96 million, and the fully diluted share capital of 365 Media at approximately £103 million. The offer was based on 6 percent premium to the 365 Media's closing price on Dec. 14, the last dealing day before the offer was made.
365 Media floated on London's Alternative Investment Market five years ago with a market capitalization of £7.6 million. The company recorded a 16 percent rise in gross profits for the six months to the end of June 2006 and a positive cash balance of £12 million for the same period.
Sky Chief Financial Officer Jeremy Darroch said the acquisition would help the company position itself in the online sports and gaming services sectors.
"Bringing together 365 Media's extensive network of sports and gaming Web sites with our own Sky Sports and SkyBet businesses will allow us to reach a broader audience," Darroch said. "This will give us greater presence in online advertising and will position us to take full advantage of growing opportunities in gaming. This combination moves forward our strategy of serving customers with high quality content and services across multiple platforms."
365 Media gained 3.5p to 67, while Sky dropped 7p to 520.
365 Media could not be reached for comment.