Mecca Bingo and Rank Group Shares Increase After Buyout
Article published on July 21, 2011 03:31am
by Hannah Swales
Mecca Bingo recently saw a hike in its share prices on the FTSE index soon after it was taken over by Guoco. Mecca Bingo and Grosvenor Casinos are owned by its parent company Rank Group and Rank shares stood the highest, subsequent to the announcement made by the gambling company that the Guoco offer was closed at the moment and a broker upgrade the company. The level of acceptance was 74.5% for its 150p a share offer, which was faintly beneath the 75% brink, which would have jeopardized the company’s listing on the London Stock Exchange.According to Panmure Gordon, a brokerage firm reaffirmed its “buy” endorsement of the company mentioning that it still is “a compelling investment proposition.” In a time when stock markets saw abundant losses with repeated fear over government debts, gambling companies such as William Hill, Betfair Group and Ladbrokes defied any such news stating that the United Kingdom Treasury intended to make a handful of regulatory modifications that would ensure that online gambling companies from foreign countries pay British tax. There was a 6.2 percent increase in Rank Group’s shares, following which it became evident that the bingo and casino operator will have its London listing, closing persistent questions in the wake of a 150p a share offer from the Guoco Group based in Hong Kong. According to Rank board, they felt in the beginning that the deal would depreciate the value of the company. Hong Kong based Guoco could have managed to take Rank Group from the London Stock Exchange list if it had achieved a 75 percent stake in the company but it scraped through as the offer was closed. The era of troubled times is finally coming to an end for Rank Group, whose board dallied four times in its recommendation to shareholders over the offer. Rank Group also managed to let loose its Chief Executive, Ian Burke before re-hiring him within a week. Many of the board members were not interested in the bid for the longest time, but they accepted the Guoco offer having in mind their stake with the shareholders. The company did not perform so well and a bit of damage control couldn’t go all that wrong, and to their expectations, things have turned out to their favour. Mecca Bingo’s stake has also been very skeptical and now since the shares have risen, everybody is contended with Rank’s performance in the market.