Betfair's shareholders to receive £300 million

A recently concluded deal between U.K. online gambling group, Betfair, and Japanese Internet firm, Softbank, will see shareholders pocketing an estimated £300 million, it was revealed in the British press this week. Under the terms of the agreement, Betfair, owner of Betfair Poker, sold Softbank a 23% stake in the company for £355 million. The company plans to invest £45 million directly into the company via new shares.

"Some of the smaller people who have a significant chunk of their wealth in the business will see a spectacular return," said Tim Bunting, Betfair's chairman. "If you were an investor in the first round, you made 130 times your money. So, obviously, some of the smaller shareholders have decided to treat themselves."

Following the conclusion of the deal, Betfair, widely regarded as one of the fastest growing Internet gaming groups in England, is now valued at £1.54 billion, and has seen its net cash position increase from £80 million to £125 million.

Plans to float on the London Stock Exchange were also revealed by Bunting, who said the company will likely launch at the end of 2007.

"The board feels that the company can grow faster privately than having the encumbrances of a public market in the foreseeable future."

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