Bidding war breaks out over Wembley

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The Independent Online

The US casinos group Penn National is in talks to buy the casino and dogs track operator Wembley PLC. News of the talks, which Wembley will announce to the Stock Exchange today, is expected to flush out rival bids from other gaming companies and private equity firms and send shares in Wembley soaring.

Penn National, which is considering a cash offer for Wembley, is a Nasdaq-listed company that owns racecourses and casinos in the US and Canada. The UK-based Wembley, which has a market value of about £180m, gains most of its revenues from Lincoln Park, its large American racetrack and casino business in Rhode Island.

However, Wembley's hopes of expanding its US operations were in effect blocked earlier this month when the company lost a key state vote in Colorado. Wembley is also involved in fighting a court case brought by the US attorney's office against the company, its former chief executive Nigel Potter and another former director Daniel Bucci, over allegations of a $4.5bn bribery conspiracy at Lincoln Park. Both men and Wembley deny the charges.

The prospect of a deal to sell Wembley is also expected to stave off a shareholder revolt at the group. Rebel investors including Fidelity and Schroders, have been trying to oust Claes Hultman, who took over as executive chairman when Mr Potter stepped down in September.