Earlier this year, South African betting operator decided to sell its horseracing business due to financial problems. Among interested was a British operator Betfred. However, creditors of South African racing operator have declined their offer to acquire Phumelela Gaming & Leisure and instead opted for a business rescue plan.
One of the wealthiest South African families are backing Mary Oppenheimer Daughters fund that will take control over Phumelela assets and rights. This family is also one of the biggest Phumelela’s creditors.
Unlike some betting operators that diversify their offering with live casino and similar online gambling activities, Phumelela is specialized in horseracing and totalisator betting. With that being said, majority of Phumelela revenue came from betting, a profitable stream for a long number of years, which changed for the worse after regulatory updates in the country, leaving the company in financial problems after their main revenue stream was hit.
Betfred’s last minute offer
Betfred’s interest in Phumelela goes back to August this year, when rumours about their interest in South African company began to surface. Soon, official proposal was on its way.
Contrary to Mary Oppenheimer Daughters offer which included financing in exchange for the racing assets, Betfred made a sudden and last-minute bid to take over the entire company and full repayment. If Phumelela accepted, they would get a full repayment vs MOD’s 72% minimum guarantee. In addition, Betfred also offered a R650 million loan and put up with 20m shares of William Hill, a