The Japanese bank said it planned to offer shares in William Hill, owner of 1,530 betting shops across the country, to retail and institutional investors, with the first dealings expected to start in March.
Nomura said it wanted to sell "between 50 and 100 per cent" of William Hill, but insiders said the finance house planned to dispose of its entire holding in the bookmaker, which last year had turnover of more than pounds 1.5bn. Up to 10 per cent of the offering will be reserved for retail investors, and analysts expect a large number of betting punters to take part.
A pounds 900m listing, which would include around pounds 400m of existing debt, would be a profitable exit for Nomura, which bought William Hill for pounds 700m from troubled leisure conglomerate Brent Walker 15 months ago.
John Brown, the managing director of William Hill who will become chief executive after the float, said the spin-off will enable the betting chain to reduce debt and grow the business. Mr Brown said telephone betting, where the group is the UK market leader, and Internet betting would be two key investment areas. He added that William Hill, which will be chaired by Ian Martin, the chairman of food group Unigate, would try to buy a small number of betting shops.
"There is probably room to buy a further 300 or 400 betting shops over the next three to four years," he said. However, he noted that bigger acquisitions would be stopped on competition grounds. The company already controls 17 per cent of the pounds 1bn-a-year betting market, the second-largest share after Ladbroke. The authorities have expressed concern at the concentration of shops in the hands of just two operators.
City analysts predicted that William Hill's healthy cash flow and steady stream of earnings would generate strong demand for its shares. They dismissed rumours that the planned listing might flush out a buyer. Industry experts noted that a move by Ladbroke would be halted by the anti-trust authorities, while smaller players such as Stanley Leisure and the state-owned Tote did not have the financial firepower. A takeover by another financial institution was seen as unlikely.Reuse content