Issuing an investor update this morning, Betfair and Paddy Power governances have confirmed that terms and conditions of their proposed £5 billion merger have been agreed on.
The announcement sees Paddy Power agreeing to acquire Betfair assets at a value of £2.86 billion ($3.2 billion). Once completed the planned merger will result in Paddy Power shareholders owning 52% of the new entity, which will trade under the name Paddy Power Betfair.
Detailing further insight on its merger plans, Paddy Power confirmed that it would pay-out a special €80 million (£59 million) dividend to its shareholders, before the deal closes.
Paddy Power shareholders are expected to vote on acquisition proceedings this December, if approved the companies will look to complete the merger by Q1 2016.
The statement confirmed to the media, that Paddy Power Betfair would be headquartered in Dublin, with Betfair’s London Hammersmith HQ maintained as a key office for its operations.
Betfair CEO Breon Corcoran has been elected to lead the new entity, with Paddy Power CEO Andy McCue as group COO.
Gary McGann, Chairman of Paddy Power, will become the chairman of Paddy Power Betfair, while Alex Gersh, CFO of Betfair, will become CFO and an executive director of the new entity.
Morgan Stanley and IBI Corporate Finance are advising Paddy Power, while Goldman Sachs Group Inc. is providing financial advice to Betfair. As expected the new entity will gain a premium listing on the London FTSE. Furthermore the new entity will seek a secondary listing on the Irish Stock Exchange as an overseas company.