Investor Group Sets Sights on 888 Holdings for Value Boost

A group of seasoned professionals in the gambling industry is pushing for a transformation at 888 Holdings Plc, the parent company of British bookmaker William Hill, with the aim of enhancing the bookmaker’s value.

Lee Feldman and Former Entain Executives Unite to Drive Change at 888 Holdings

Notable members of the consortium group include Lee Feldman, the former chairman of betting firm GVC Holdings Plc, now known as Entain Plc.

Lee Feldman expressed his belief that the assets of 888 Holdings Plc are currently undervalued, Bloomberg reported. However, he refrained from offering additional comments. The market responded positively to this news, with shares in 888 experiencing a significant 14% surge in London. As a result, the company’s market capitalization reached £359 million ($446 million).

Feldman has joined forces with other former executives from Entain, including Kenny Alexander and Shay Segev, both of whom served as chief executive officers at the company. The group is also comprised of Stephen Morana, a former director at Entain, as well as B. Riley Financial Inc. and its chief investment officer, Daniel Shribman.

Insiders familiar with the matter revealed that the consortium has already approached 888 with proposals to enhance the company’s value. These proposals may include changes in leadership and strategy.

888’s Market Value Declines Amidst Debt Woes and Regulatory Challenges

888’s market capitalization has significantly declined since its peak of approximately £1.8 billion ($2.2 billion) in 2021. This drop can be attributed to the company’s debt-financed acquisition of William Hill’s assets outside the US. 

Concerns regarding the high level of borrowing arose after interest rates surged, resulting in a net debt that amounted to 5.6 times the company’s earnings by the end of the previous year, something that also became clear from the company’s FY 2022 financial report. This debt burden has also limited the company’s capacity to invest in growth.

A spokesperson for 888 expressed the company’s appreciation for the investment, stating that it reflects the substantial potential for value creation within their business. The spokesperson further highlighted the board’s unwavering confidence in its long-term strategy to maximize value for shareholders. 

In January, CEO Itai Pazner stepped down from his position at 888 amidst an investigation into potential violations of money-laundering policies within the gambling group’s VIP accounts. Furthermore, in March, the company’s William Hill division agreed to a settlement of £19.2 million ($23.8 million) to address failures related to social responsibility and money laundering. These failures included allowing customers to gamble with one business entity after self-exclusion from a sister company.