Sky Sells Majority Stake In Sky Bet

Satellite broadcaster Sky has offered a majority stake in Sky Bet, valuing the betting operation at ₤ 800m.

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The Leeds-based operation, that includes sites such as Sky Vegas and Sky Bingo, is being bought by personal equity group CVC Capital Partners., external

Sky will be paid ₤ 600m when the deal is completed next year and will keep a 20% stake.

Betting and gaming was not considered as part of Sky's core business, a spokesperson stated.

The sale would permit it to concentrate on the "significant growth opportunities" in pay television in the 5 European markets it operated in, Sky said.

The company just recently finished the acquisition of Sky Italia and a 90% stake in Sky Deutschland, bringing its client base to 20 million throughout Britain, Ireland, Germany, Austria and Italy.

Jeremy Darroch, president of Sky, said the sale realised "significant worth" for shareholders.

Shares in Sky increased 1.2% to 938p in London, valuing the company at just over ₤ 16bn. The stock has increased by almost 20% in the past 12 months.

'Successful property'

Analysts at Citi said Sky might use some of the earnings to buy out the remaining minority investors in Germany, including: "We believe a sale of Sky Bet is a sensible strategic move."

Investec explained Sky Bet is a "non-core however extremely successful possession" and stated profits ought to assist the business pay for financial obligation, which was expected to be ₤ 6.3 bn for the 2015 financial year.

CVC, which has actually had an interest in the betting and gaming sector with stakes in business such as William Hill and IG Group, shopped Betfair last year in a ₤ 1bn deal. However, the yohaig code two companies failed to settle on rate.

The private equity group manages the Formula One motor racing business.

Sky Bet will remain in Leeds with all personnel relocating to the new entity.