TSX Venture Exchange put the brakes on trading for Contagious Gaming (
TSX: V.CNS,
Forum) today when press speculation triggered
a response from the so-called potential target, UK-based Sportech (
GREY: SPOZF,
Forum), a provider of sports betting entertainment and wagering technology solutions, confirming that it did indeed receive a takeover bid from Contagious.
Sportech, whose
SP shot up 10% on the news to 69.21p per share on the London Stock Exchange, was quick to state, “A further announcement will be made when appropriate. In the meantime, Sportech shareholders are advised by the Board to take no action. There can be no certainty that any formal offer for the Company will be forthcoming, nor as to the terms of any such formal offer.”
It also went on to note, “The proposal is subject to due diligence, Contagious Gaming raising suitable financing and Contagious Gaming receiving a significant level of support for the proposal from Sportech shareholders.”
Contagious Gaming’s bid, if successful, would snap up the £142.6m world leading operator of pool betting organizations at, what Sportech states, a recommended offer of a premium 62.63p in a combination of cash and shares.
Investors took to the speculation and Sportech’s confirming release like bees to honey and Contagious stock jumped 11.36% before the TSX Venture Exchange stepped in. Contagious has yet to speak on the matter, but it is expected that both parties will make a formal statement regarding the possible transaction on Monday before market open.
Adding Sportech to the portfolio would significantly broaden Contagious’ offering and expand its market share, creating a company worthy of sector dominance in the region and establishing a formidable launching pad for further international expansion in regulation-friendly jurisdictions. However, at this moment, despite Sportech’s confirmation, the completion of such a deal is still speculation and will remain that way until a formal announcement says otherwise. I, for one, am on pins and needles, waiting to see which way the wind is blowing on this one.
FULL DISCLOSURE: Contagious Gaming is a Stockhouse Publishing client.