Arena takeover talk
The Reuben brothers, the billionaire private investors, have quietly accumulated a 14% stake in Arena Leisure, the owner of Royal Windsor and Lingfield racecourses. The move has led many to believe that they could be making their first strides towards a takeover.
The brother’s identity has been kept a secret on the share register as they purchased their stake by using a derivative known as a contract for difference (CFD). This way the buyer only pays a small part of the value of the stock, making it a cost-effective way to gain a strong position within a company.
It is believed the brothers see Arena as an undervalued asset with great potential and want to gain a prominent place at the negotiating table, should takeover discussions go ahead.
Millionaire owner of the Blackpool Tower, Trevor Hemmings, owns more than 40% of the company through his investment companies, Guild Ventures and Rumney Manor. HBOS, one of his chief financial backers, owns a further five percent.
Shares in Arena rose by 5.5 per cent amid the news, with many analysts citing the stock as highly desirable. If granted a casino licence by the government next year, Arena hopes to develop a casino at the Wolverhampton Racecourse in a partnership with Ladbrokes. If successful, analysts believe the value of Arena will continue to rise.
Editor, Jackpot.co.uk - 2006-12-19 11:27:52