Betfred bid to buy South African racing site Phumelela in a ZAR 925m deal

Betfred has offered to buy Phumelela Gaming & Leisure in a deal worth up to ZAR 925m (approx $54.8m) that would see it acquire all of the South African horseracing operator’s assets. According to CalvinAyre.com, Phumelela has been teetering on the financial brink for over a year after regulatory changes deprived it of a crucial share of race betting winning levies in the province of Gauteng.

It was mention that the operator’s offer includes an initial payment of ZAR 875m, followed by a deferred ZAR 50m consideration which will be paid upon certain EBITDA based performance targets being met by the horseracing business.

Furthermore, it was said, Phumelela has sketched out a rescue plan including the sale of certain assets and operations to Mary Oppenheimer Daughters (MOD) – a fund backed by one of the country’s wealthiest families, but also one of Phumelela’s largest creditors – Betfred’s offer involves all assets of Phumelela, and not merely some of the assets as contemplated in the offer made by [MOD]. Additionally, Betfred has promised to preserve all Phumelela’s business units and retain all staff. It was also mentioned that should Betfred’s offer be rejected by September 1, the company says the offer will lapse.