Rank Bingo Shares Climb in Midst of Takeover Rumors - 04-03-08

April 3 - One of the United Kingdom's most successful bingo operators, Rank Group Plc announced an impressive 9.9% increase in share prices yesterday, amidst new reports that the company had been offered a multi-million pound take over bid by Asian investors, Genting Bhd.

Yesterday, Rank bingo shares were trading at 97 pence, a rise of 8.75 pence, and the most they have increased in the last four month period.

It was recently reported that Genting, that has an 11% holding in Rank bingo, offered the company 124 pence for each its shares, a deal worth 485 million UK Pounds, or an impressive $959 million.

Genting shot to fame in the British financial markets after it bought over Stanley Leisure Plc in 2006, one of the United Kingdom's largest gaming operators. This sale put Genting in the forefront of the local casino market, allowing it to purchase substantial Rank stock.

An industry analyst said that a take over by Genting would be a cost saving potential for the company but he admitted that it could cause competition issues initially. "I am sure they would have to dispose of casinos in some regional markets," he said.

It is believed that Genting's offer comes in order to block the bids of other interested parties who have have put in offers to purchase the Rank Group. Another Asian investor, Hong Leong Co., based in Malaysia, has a 9% stake in the company, while others hold interests through various contacts.

Since the indoor smoking ban came into effect in the United Kingdom, many Rank bingo halls have found themselves in dire financial straits, and some have been forced to close down. Operating over  bingo halls and casinos across the country, the company was faced with problems after its share prices slid three fifths last year. Since then, interested parties have been approaching management to offer a deal that may result in a final contract.

It remains to be seen whether Genting's latest bid, admittedly very generous, could result in a successful cash takeover.

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