News Archive

20 December 2012

Recommended Offer for Sportingbet plc

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (IN WHOLE OR IN PART) DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

RECOMMENDED OFFER
FOR
SPORTINGBET PLC
BY
WILLIAM HILL AUSTRALIA PTY LIMITED, A WHOLLY OWNED SUBSIDIARY OF WILLIAM HILL PLC
AND
GVC HOLDINGS PLC

to be effected by means of a Scheme of Arrangement
under Part 26 of the Companies Act 2006

Summary

  • The boards of William Hill plc ("William Hill"), GVC Holdings plc ("GVC") and Sportingbet plc ("Sportingbet") are pleased to announce that they have reached agreement on the terms of a recommended offer pursuant to which GVC will acquire the entire issued and to be issued share capital of Sportingbet and members of the William Hill Group will acquire the Sportingbet Australian Business and certain other assets from the Sportingbet Group and be granted a call option over the Sportingbet Spanish Business (the "Offer"). The Offer is to be effected by means of a scheme of arrangement under Part 26 of the Companies Act.
  • The Offer values each Sportingbet Share at 56.1 pence per share, based on a Closing Price per GVC Share of 233.5 pence on 15 October 2012, being the last Business Day prior to the suspension of the GVC Shares, and taking into account the previously announced final dividend of 1.1 pence per Sportingbet Share. The Offer comprises 44.8 pence in cash and 0.0435 New GVC Shares per Sportingbet Share and, in addition, those Sportingbet Shareholders on the Sportingbet register at the dividend record time (21 December 2012) will receive the final dividend of 1.1 pence per Sportingbet Share in respect of the year ended 31 July 2012 (which was approved at Sportingbet's AGM on 19 December 2012). 
  • On this basis, the Offer values the entire issued and to be issued share capital of Sportingbet on a fully diluted basis (assuming payment in full to Sportingbet Convertible Bondholders of the Sportingbet Convertible Bonds at their see through conversion value and exercise of all outstanding in the money options and LTIP awards) at approximately £485 million.
  • Therefore, the Offer (taking into account the Sportingbet final dividend) represents a premium of approximately:
    • 70.0 per cent. to the Closing Price per Sportingbet Share of 33.0 pence on 16 July 2012, being the last Business Day prior to the publication of press speculation that Sportingbet was a potential bid target;
    • 57.1 per cent. to the average Closing Price per Sportingbet Share of 35.7 pence for the three month period ended on 18 September 2012, being the last Business Day prior to the public announcement of William Hill and GVC's interest in Sportingbet;
    • 28.2 per cent. to the Closing Price per Sportingbet Share of 43.8 pence on 18 September 2012, being the last Business Day prior to the public announcement of William Hill and GVC's interest in Sportingbet; and
    • 8.4 per cent. to the Closing Price per Sportingbet Share of 51.8 pence on 19 December 2012, being the last Business Day prior to the making of this announcement.
  • A Mix and Match Facility will be provided, which will allow Scheme Shareholders (other than Restricted Overseas Shareholders) to elect to vary the proportions in which they receive cash and New GVC Shares.
  • Through the irrevocable undertakings by certain Sportingbet Shareholders and the cash underpinning and other arrangements that GVC has put in place (as described below), elections by other eligible Scheme Shareholders under the Mix and Match Facility to take up to the entirety of their consideration under the Offer in the form of cash will be satisfied in full, if the elections for New GVC Shares which are committed to under the irrevocable undertakings detailed below are duly made in accordance with their terms.
  • Henderson Global Investors, which through the Volantis Capital team exercises investment management control over 10,102,999 Sportingbet Shares, representing approximately 1.5 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement), has executed an irrevocable undertaking consenting to the Scheme and undertaking to be bound by it and undertaking to vote in favour of the Sportingbet Shareholder Resolution to be proposed at the Sportingbet General Meeting and also to elect under the Mix and Match Facility to take the entirety of the consideration attributable to such Sportingbet Shares under the Offer in the form of New GVC Shares.
  • Certain other Sportingbet Shareholders (namely DBS Advisors Ltd., Mark Blandford (with family trusts) and Rockridge Investments S.A.), who hold or are beneficially entitled to 63,460,735 Sportingbet Shares in aggregate, representing approximately 9.5 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement) have executed irrevocable undertakings to vote both in favour of the Scheme and in favour of the Sportingbet Shareholder Resolution, and also to elect under the Mix and Match Facility to take the entirety of their consideration under the Offer in the form of New GVC Shares.
  • In addition, Bonaire Investment Holdings Ltd, which holds or is beneficially entitled to 45,045,275Sportingbet Shares, representing approximately 6.8 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement), has executed an irrevocable undertaking to vote both in favour of the Scheme and in favour of the Sportingbet Shareholder Resolution, and also to take a minimum of 1,100,000 New GVC Shares under the Mix and Match Facility as its consideration under the Offer.
  • In addition, GVC has entered into cash underpinning arrangements with Henderson AIA and also with Richard Griffiths and Antisoma plc (who are respectively a controlling shareholder of, and a company connected to, Ora Capital) whereby if, notwithstanding the irrevocable commitments to elect for New GVC Shares referred to above (and other eligible Scheme Shareholders either making no election under the Mix and Match Facility or making an election for an increased proportion of New GVC Shares), the Mix and Match Facility does not operate so as to deliver to any eligible Scheme Shareholders the full amount of cash consideration for which they have elected, Henderson AIA, Richard Griffiths and Antisoma plc will acquire for cash (at a price of 233.5 pence per New GVC Share) the New GVC Shares otherwise attributable to such eligible Scheme Shareholders (or such of those shares as those eligible Scheme Shareholders have elected not to receive). This will result in additional cash being available to those eligible Scheme Shareholders whose elections for cash have not been fully satisfied through the operation of the Mix and Match Facility. The maximum commitments of Henderson AIA, Richard Griffiths and Antisoma plc under these cash underpinning arrangements are in respect of 5,000,000 New GVC Shares, 783,725 New GVC Shares and 1,713,062 New GVC Shares respectively.
  • Further, to the extent that eligible Scheme Shareholders elect for cash consideration, and such elections cannot otherwise be satisfied pursuant to the operation of the Mix and Match Facility and the cash underpinning arrangements referred to above, GVC will make an amount of up to £7.226 million available pursuant to the Offer to satisfy such elections (and accordingly will not issue up to 3,094,229 New GVC Shares which would otherwise have been issued to such Scheme Shareholders).
  • The ability of eligible Scheme Shareholders to receive their entire consideration in the form of cash if they elect to do so under the Mix and Match Facility will be dependent on the irrevocable undertakings provided by certain Sportingbet Shareholders to elect for New GVC Shares (as detailed above) being complied with in accordance with their terms or, failing that, on sufficient elections for New GVC Shares being made by other eligible Scheme Shareholders.
  • Each of the Sportingbet Shareholders who has irrevocably undertaken to elect under the Mix and Match Facility to take the entirety of its consideration under the Offer in the form of New GVC Shares, or to receive as consideration not less than a specified minimum number of New GVC Shares, has also undertaken to deliver a Form of Election to this effect within seven days after the posting of the Scheme Document. In the event that any such Form of Election is not duly received within this seven day period, an appropriate announcement will be made pursuant to Rule 2.11 of the City Code.
  • In addition, UBS, which exercises investment control over 29,472,443 Sportingbet Shares, representing approximately 4.4 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement), has executed an irrevocable undertaking to vote both in favour of the Scheme and in favour of the Sportingbet Shareholder Resolution. UBS has also stated, on a non-binding basis, that, subject to any client restrictions, it intends to make no election under the Mix and Match Facility.
  • The Sportingbet Directors, who have been so advised by Lazard, consider the terms of the Offer to be fair and reasonable. In providing advice to the Sportingbet Directors, Lazard has taken into account the commercial assessments of the Sportingbet Directors.
  • Accordingly, the Sportingbet Directors intend unanimously to recommend that Scheme Shareholders and Sportingbet Convertible Bondholders vote in favour of the Scheme at the Court Meetings and to recommend that Sportingbet Shareholders vote in favour of the Sportingbet Shareholder Resolution to be proposed at the Sportingbet General Meeting, as the Sportingbet Directors who beneficially own or control, and can procure the voting of, Scheme Shares have irrevocably undertaken to do in respect of their controlled holdings of, in aggregate, 5,492,756 Sportingbet Shares, representing approximately 0.8 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement). The Sportingbet Directors do not intend to make any recommendation to eligible Scheme Shareholders as to whether or not they should make any particular election under the Mix and Match Facility. In determining whether to make any election under the Mix and Match Facility, eligible Scheme Shareholders should pay particular consideration to the contents of the GVC Prospectus which will accompany the Scheme Document to be sent to Scheme Shareholders in due course.
  • Accordingly, William Hill and GVC have received irrevocable undertakings in support of the Scheme in relation to an aggregate of 153,574,208 Sportingbet Shares, representing approximately 23.0 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement). Further details of these irrevocable undertakings are set out in Part A of Appendix III to the following announcement.
  • The GVC Directors intend unanimously to recommend that GVC Shareholders vote in favour of the GVC Shareholder Resolution to be proposed at the GVC General Meeting, as the GVC Directors who beneficially own or control, and can procure the voting of, GVC Shares have irrevocably undertaken to do in respect of their controlled holdings of, in aggregate, 522,033 GVC Shares, representing approximately 1.7 per cent. of the share capital of GVC in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement).
  • Furthermore, GVC has received irrevocable undertakings from certain other GVC Shareholders (namely Henderson Global Investors, Ora Capital and Audley Capital Management Limited) to vote in favour of the GVC Shareholder Resolution to be proposed at the GVC General Meeting in respect of an aggregate of 15,855,961 GVC Shares, representing approximately 50.2 per cent. of the share capital of GVC in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement).
  • Accordingly, GVC has received irrevocable undertakings in relation to an aggregate of 16,377,994 GVC Shares, representing approximately 51.8 per cent. of the share capital of GVC in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement) to vote in favour of the GVC Shareholder Resolution to be proposed at the GVC General Meeting. Further details of these irrevocable undertakings are set out in Part B of Appendix III to the following announcement.
  • Under the terms of the Offer, Sportingbet Convertible Bondholders will be entitled to receive in cash the amount that represents the see through value of the Sportingbet Convertible Bonds under their terms as if the Sportingbet Convertible Bondholders had exercised their right to convert their bonds into Sportingbet Shares at the Effective Date and received cash consideration of 55 pence per resulting Sportingbet Share. The cash amount payable to Sportingbet Convertible Bondholders will be calculated based on the Change of Control Conversion Price. Sportingbet Convertible Bondholders will not be entitled to participate in the Mix and Match Facility.
  • Following the issue of the Reduction Court Order by the Court and prior to the Effective Time, members of the William Hill Group will acquire the Sportingbet Australian Business, the "miapuesta" brand and certain Guernsey domiciled companies that hold the title to the Guernsey Properties from the Sportingbet Group and be granted a call option over the Sportingbet Spanish Business. At the Effective Time, GVC will acquire the entire issued and to be issued share capital of Sportingbet, which will then be the holding company of the remaining businesses carried on by Sportingbet and its subsidiary undertakings (the "Remaining Sportingbet Businesses").
  • Sportingbet is an online sports betting and gaming group focused on the European and Australian markets supplemented by an emerging markets business. The Sportingbet Group facilitates online sports betting, casino, poker and gaming through a range of branded websites. The Sportingbet Group currently holds betting and gaming licences and approvals in Alderney, Australia, Denmark, Ireland, Italy, Malta, South Africa, Spain and the UK. For the year ended 31 July 2012, Sportingbet generated EBITDA of £56.8 million (adjusted for exceptional items, share option charges and amortisation of other intangible assets) on Amounts Wagered of £2,349.2 million.
  • William Hill is one of the world's leading betting and gaming companies, employing more than 15,000 people. It is now the UK's largest bookmaker with 2,370 licensed betting offices that provide betting opportunities on a wide range of sporting and non-sporting events, gaming on machines and numbers-based products including lotteries.
  • GVC is a leading provider of B2B and B2C services to the online gaming and sports betting markets and its shares have been traded on AIM since 2004. GVC's B2C offerings target German speaking markets and Brazilian customers, while the B2B business unit consists principally of the third party support contract for East Pioneer Corporation B.V., which acquired the Superbahis brand from Sportingbet in November 2011.
  • For William Hill, Australia is one of the most attractive online locally licensed markets where it, as yet, does not have a presence. The Australian betting market is one of the largest locally licensed betting markets in the world and the Sportingbet Australian Business is one of the leading online corporate bookmakers in Australia. William Hill has particular skills in those areas of the market that are demonstrating strong structural growth: online, mobile, fixed odds and sports (non-horse racing) betting. William Hill believes it has the resources and expertise to continue to grow the Sportingbet Australian Business successfully, building on its existing strong market position. William Hill has also recently entered the licensed online Spanish gambling market on an organic basis. The acquisition of the Sportingbet Spanish Business is expected to allow William Hill to achieve critical mass in that market faster than it otherwise would have done. Overall, William Hill believes that the acquisition of the Regulated Sportingbet Businesses will further develop the William Hill Group's online and multi-channel operations and increase the William Hill Group's exposure to attractive locally licensed jurisdictions and its geographic diversification, all of which are central elements of the William Hill board's strategy. In doing so, the William Hill board believes that William Hill is well placed to create further value for its shareholders.
  • For GVC, this transaction is consistent with its strategy of generating returns from highly cash generative internet gaming and gambling brands. The Remaining Sportingbet Businesses include a number of jurisdictions where Sportingbet does not have a local licence that will complement the existing profile of GVC and consolidate GVC's position as a leading operator in markets which may soon be locally licensed. GVC will seek to leverage the market leading sportsbook platform and trading team of these businesses to provide further growth. In addition, the Offer will result in GVC's earn-out liabilities in relation to the Superbahis brand becoming recoverable by the Enlarged GVC Group.
  • The Offer will require the approval of Sportingbet Shareholders, Sportingbet Convertible Bondholders and GVC Shareholders, the sanction of the Court, the agreement of the London Stock Exchange to admit or re-admit (as applicable) the GVC Shares (including the New GVC Shares) to trading on AIM and receipt of the Australian Licence Approval and the Australian Foreign Investment Review Board Approval. Upon the Scheme becoming effective, it will be binding on all Scheme Shareholders and Sportingbet Convertible Bondholders, irrespective of whether or not they attended or voted at the Shareholder Court Meeting or the Sportingbet General Meeting (or, in the case of the Sportingbet Convertible Bondholders, at the Sportingbet Convertible Bond Court Meeting) and, if they attended and voted, whether or not they voted in favour.
  • It is expected that the Scheme Document, containing further information about the Offer and notices of the Court Meetings and the Sportingbet General Meeting, together with the relevant Form(s) of Proxy and Form of Election, will be sent to Sportingbet Shareholders and Sportingbet Convertible Bondholders on or around 15 January 2013. It is expected that, subject to the satisfaction or (where applicable) waiver of the conditions and certain further terms set out in Appendix I to the following announcement and to be set out in the Scheme Document, the Scheme will become fully operative in March 2013.
  • It is expected that the GVC Prospectus, containing information about the New GVC Shares and the Enlarged GVC Group, and the GVC Shareholder Circular, containing the notice convening the GVC General Meeting, will be published at the same time as the Scheme Document is posted to Sportingbet Shareholders and Sportingbet Convertible Bondholders.
  • Commenting on the Offer, Ralph Topping, Chief Executive of William Hill, said:

    "We are pleased to reach agreement with the Board of Sportingbet, who unanimously recommend our joint offer. This acquisition not only highlights William Hill's commitment to grow further internationally into regulated, high growth markets such as Australia, but also supports our strategic aim to diversify revenue sources into new territories and through greater multi-channel usage. Our unique combination with GVC provides a complete solution for Sportingbet and its shareholders and we look forward to working with the management and employees of Sportingbet in Australia and Spain to combine our joint experience and expertise to create additional value for our customers and shareholders."
  • Commenting on the Offer, Kenneth Alexander, Chief Executive Officer of GVC, said:

    "The acquisition of the Remaining Sportingbet Businesses will be transformational for GVC. The businesses GVC is acquiring will complement the existing profile of GVC and should consolidate its position as one of the leading operators in its market. A key element of GVC's strategy has been maintaining an aggressive dividend policy and the GVC Directors believe that the acquisition of the Remaining Sportingbet Businesses will contribute to this strategy going forward."
  • Commenting on the Offer, Andrew McIver, Chief Executive Officer of Sportingbet, said:

    "Sportingbet is one of the world's best known online sports betting companies renowned for the quality of its product offering, customer service and technological innovation. This position has been achieved thanks to the considerable efforts and skills of all our staff, who managed so successfully to turn the business around following the Sportingbet Group's exit from the US market in 2006. Every Sportingbet employee around the world should be proud of what has been achieved. This offer represents a good outcome for Sportingbet shareholders as they can elect to receive the offer in cash and it is at a significant premium to the Group's share price in the three month period prior to the consortium announcing their interest in Sportingbet on 19 September 2012."

Investor and Analyst Meeting:

William Hill will hold a meeting for analysts and investors on 20 December 2012 at 4.45 p.m. (UK time) to discuss the Offer. The meeting will take place at The Lincoln Centre, 18 Lincoln's Inn Fields, London WC2A 3ED. Interested parties can dial into this meeting using the following access details:

Inside the UK 0800 634 5205
Outside the UK +44 (0) 20 8817 9301
The participant passcode is 9624114

The meeting will also be available by webcast on William Hill's website for all interested parties. The webcast can be accessed via William Hill's website, www.williamhillplc.com. A replay facility will be available via William Hill's website and by dialling +44 (0) 20 7769 6425 quoting the replay access code 9589 073# until 3 January 2013.

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Enquiries:

William Hill
Ralph Topping, Chief Executive
Neil Cooper, Group Finance Director
Lyndsay Wright, Director of IR
+44 (0)20 8918 3614
   
Citi (Lead Financial Adviser and Joint Broker to William Hill)
Jan Skarbek
Andrew Seaton
Sajjad Vakilian
+44 (0)20 7986 4000
   
Investec (Financial Adviser and Joint Broker to William Hill)
Chris Treneman
James Rudd
+44 (0)20 7597 5970
   
Brunswick (PR Adviser to William Hill)
Simon Sporborg
+44 (0)20 7404 5959
   
GVC
Kenneth Alexander, Chief Executive Officer
Richard Cooper, Group Finance Director
+44 (0)20 7398 7702
   
Daniel Stewart (Financial Adviser, NOMAD and Broker to GVC)
Paul Shackleton
David Hart
+44 (0)20 7776 6550
   
Abchurch (PR Adviser to GVC Holdings) +44 (0)20 7398 7702
Henry Harrison-Topham  
   
Sportingbet
Andrew McIver
Jim Wilkinson
+44 (0)20 7184 1800
   
Lazard (Financial Adviser to Sportingbet)
Cyrus Kapadia
Aamir Khan
+44 (0)20 7187 2000
 
   
Canaccord Genuity Limited (Broker to Sportingbet)
Erik Anderson
Bruce Garrow
+44 (0)20 7523 8350
   
Maitland (PR Adviser to Sportingbet)
George Hudson
Daniel Yea
+44 (0)20 7379 5151
+44 (0)75 9527 0877
+44 (0)75 9527 0691

 

This summary should be read in conjunction with, and is subject to, the full text of the following announcement (including its Appendices). References to "this announcement" shall be deemed to refer to this summary and the following announcement (including its Appendices). The Offer will be subject to the conditions and certain further terms set out in Appendix I to this announcement and to the full terms and conditions to be set out in the Scheme Document, the Forms of Proxy and the Form of Election. Appendix II to this announcement contains the sources and bases of certain information contained in this announcement. Appendix III to this announcement contains details of the irrevocable undertakings received by William Hill and GVC in respect of voting in favour of the Scheme at the Shareholder Court Meeting and in favour of the Sportingbet Shareholder Resolution at the Sportingbet General Meeting and in relation to elections for New GVC Shares under the Mix and Match Facility and also details of the irrevocable undertakings procured by GVC in respect of voting in favour of the GVC Shareholder Resolution at the GVC General Meeting and details of the cash underpinning arrangements described in this announcement. Appendix IV to this announcement contains the definitions of certain terms used in this announcement.

Further information

Citigroup Global Markets Limited, who is authorised and regulated in the UK by the Financial Services Authority, is acting for William Hill and no-one else in connection with the Offer and will not regard any other person as a client in relation to the Offer and will not be responsible to anyone other than William Hill for providing the protections afforded to its clients or for providing advice in relation to the Offer or any matters referred to in this announcement.

Investec Investment Banking, a division of Investec Bank plc, who is authorised and regulated in the UK by the Financial Services Authority, is acting for William Hill and no-one else in connection with the Offer and will not regard any other person as a client in relation to the Offer and will not be responsible to anyone other than William Hill for providing the protections afforded to its clients or for providing advice in relation to the Offer or any matters referred to in this announcement.

Daniel Stewart & Company plc, who is authorised and regulated in the UK by the Financial Services Authority, is acting for GVC and no-one else in connection with the Offer and will not regard any other person as a client in relation to the Offer and will not be responsible to anyone other than GVC for providing the protections afforded to its clients or for providing advice in relation to the Offer or any matters referred to in this announcement.

Lazard & Co., Limited, who is authorised and regulated in the UK by the Financial Services Authority, is acting for Sportingbet and no-one else in connection with the Offer and will not regard any other person as a client in relation to the Offer and will not be responsible to anyone other than Sportingbet for providing the protections afforded to its clients or for providing advice in relation to the Offer or any matters referred to in this announcement.

Canaccord Genuity Limited, who is authorised and regulated in the UK by the Financial Services Authority, is acting for Sportingbet and no-one else in connection with the Offer and will not regard any other person as a client in relation to the Offer and will not be responsible to anyone other than Sportingbet for providing the protections afforded to its clients or for providing advice in relation to the Offer or any matters referred to in this announcement.

Sportingbet Shareholders and Sportingbet Convertible Bondholders may request a hard copy of this announcement by contacting Sportingbet's registrar, Capita Registrars on 0871 664 0321 (from inside the UK) or +44 20 8638 3399 (from outside the UK). Calls to the 0871 664 0321 number cost 10 pence per minute (including VAT) plus any of your service provider's network extras, lines are open 9.00 a.m. - 5.30 p.m (UK time) Monday to Friday. Calls to the Capita Registrars' +44 20 8638 3399 number from outside the UK are charged at applicable international rates. Different charges may apply to calls made from mobile telephones and calls may be recorded and monitored randomly for security and training purposes. Capita Registrars cannot provide advice on the merits of the Offer nor give any financial, legal or tax advice. It is important to note that unless such a request is made, a hard copy of this announcement will not be sent to any Sportingbet Shareholder or Sportingbet Convertible Bondholder. A Sportingbet Shareholder or Sportingbet Convertible Bondholder may also request that all future documents, announcements and information to be sent to that Sportingbet Shareholder or Sportingbet Convertible Bondholder in relation to the Offer should be in hard copy form.

This announcement is for information purposes only and does not constitute an offer to sell or an invitation to purchase or subscribe for any securities or the solicitation of an offer to buy any securities in any jurisdiction, pursuant to the Offer or otherwise, nor shall there be any sale, issue or transfer of the securities referred to in this announcement in any jurisdiction in contravention of applicable law. The Offer will be made solely by means of the Scheme Document or any other document by which the Offer is made which will contain the full terms and conditions of the Offer, including details of  how to vote in respect of  the Scheme.

This announcement has been prepared for the purpose of complying with English law and the City Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside the United Kingdom.

Sportingbet will prepare the Scheme Document to be distributed to Sportingbet Shareholders and Sportingbet Convertible Bondholders. Sportingbet, William Hill and GVC urge Sportingbet Shareholders and Sportingbet Convertible Bondholders to read the Scheme Document and the GVC Prospectus when they become available because they will contain important information relating to the Offer. Any approval, decision or other response to the Offer should be made only on the basis of the information in the Scheme Document and the GVC Prospectus.

The statements contained in this announcement are made as at the date of this announcement, unless some other time is specified in relation to them. Nothing contained in this announcement shall be deemed to be a forecast, projection or estimate of the future financial performance of Sportingbet or the Sportingbet Group, William Hill or the William Hill Group or GVC or the GVC Group except where otherwise stated.

Overseas Shareholders

The release, publication or distribution of this announcement in certain jurisdictions may be restricted by law. Persons who are not resident in the United Kingdom or who are subject to the laws of other jurisdictions should inform themselves of, and observe, any applicable requirements. Any failure to comply with the restrictions may constitute a violation of the securities laws of any such jurisdiction. The Offer relates to securities of an English company and is proposed to be effected by means of a scheme of arrangement under the laws of England and Wales. The Scheme will relate to the shares of an English company that is a "foreign private issuer" as defined under Rule 36.4 under the US Securities Exchange Act of 1934, as amended (the "Exchange Act"). A transaction effected by means of a scheme of arrangement is not subject to proxy solicitation or tender offer rules under the Exchange Act. Accordingly, the Scheme is subject to the disclosure requirements, rules and practices applicable in the United Kingdom to schemes of arrangement, which differ from the requirements of US proxy solicitation or tender offer rules and the laws of other jurisdictions outside the United Kingdom. Financial information included in the relevant documentation will have been prepared in accordance with accounting standards applicable in the United Kingdom that may not be comparable to the financial statements of US companies. However, if  William Hill Australia and GVC were to elect to implement the Offer by means of  a takeover offer, such takeover offer will be made in compliance with all applicable laws and regulations, including US tender offer rules, to the extent applicable.

Unless otherwise determined by William Hill Australia and GVC or required by the City Code, and permitted by applicable law and regulation, the Offer will not be made available, directly or indirectly, in, into or from a Restricted Jurisdiction and no person may vote in favour of  the Offer by any use, means, instrumentality or form within a Restricted Jurisdiction or any other jurisdiction where to do so would violate the laws of such jurisdiction. Accordingly, copies of  this announcement and all documents relating to the Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in, into or from a Restricted Jurisdiction or any other jurisdiction where to do so would violate the laws of such jurisdiction, and persons receiving this announcement and all documents relating to the Offer (including custodians, nominees and trustees) must not mail or otherwise distribute or send them in, into or from such jurisdictions where to do so would violate the laws in that jurisdiction. The Offer (unless otherwise permitted by applicable law and regulation) will not be made, directly or indirectly, in or into, or by the use of the mails, or by any means or instrumentality (including without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of, any Restricted Jurisdiction, and the Offer will not be capable of acceptance from or within any Restricted Jurisdiction.

The availability of the Offer to Sportingbet Shareholders and Sportingbet Convertible Bondholders who are not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions in which they are resident. Persons who are not resident in the United Kingdom should inform themselves of, and observe, any applicable requirements.

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Forward-looking statements

This announcement contains statements which are, or may be deemed to be, "forward-looking statements" which are prospective in nature. All statements other than statements of historical fact may be forward-looking statements. They are based on current expectations and projections about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of forward-looking words such as "plans", "expects", "is expected", "is subject to", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", "believes", "targets", "aims", "projects" or words or terms of similar substance or the negative thereof, as well as variations of such words and phrases or statements that certain actions, events or results "may", "could", "should", "would", "might" or "will" be taken, occur or be achieved. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Forward-looking statements include statements relating to the following: (i) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and prospects; (ii) business and management strategies and the expansion and growth of William Hill's, GVC's or Sportingbet's operations and potential synergies resulting from the Offer; and (iii) the effects of government regulation on William Hill's, GVC's or Sportingbet's business.

Such forward looking statements involve risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results to differ materially from those projected or implied in any forward looking statements. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward looking statements, which speak only as of the date hereof. Each of William Hill, GVC and Sportingbet disclaims any obligation to update any forward looking or other statements contained herein, except as required by applicable law.

Except as expressly provided in this announcement, no forward looking or other statements have been reviewed by the auditors of William Hill, GVC or Sportingbet. All subsequent oral or written forward looking statements attributable to William Hill, GVC or Sportingbet or any of their respective members, directors, officers or employees or any person acting on their behalf are expressly qualified in their entirety by the cautionary statement above.

Disclosure requirements of the City Code

Under Rule 8.3(a) of the City Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th Business Day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th Business Day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the City Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the Business Day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3. William Hill, GVC and the Panel have agreed that for the purposes of this offer period GVC will be treated as a paper offeror for the purposes of Rule 8.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Information relating to Sportingbet Shareholders

Please be aware that addresses, electronic addresses and certain other information provided by Sportingbet Shareholders, persons with information rights and other relevant persons for the receipt of communications from Sportingbet may be provided to William Hill, William Hill Australia or GVC during the offer period as requested under Section 4 of Appendix 4 of the City Code to comply with Rule 2.12(c).

Publication on website

A copy of this announcement will be available free of charge, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, on William Hill's website at www.williamhillplc.com, on GVC's website at www.GVC-plc.com and on Sportingbet's website at www.sportingbetplc.com by no later than noon (London time) on the day following this announcement. For the avoidance of doubt, the contents of those websites are not incorporated into and do not form part of this announcement.

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NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (IN WHOLE OR IN PART)
DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE
A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

RECOMMENDED OFFER
FOR
SPORTINGBET PLC
BY
WILLIAM HILL AUSTRALIA PTY LIMITED, A WHOLLY OWNED SUBSIDIARY OF WILLIAM HILL PLC
AND
GVC HOLDINGS PLC

to be effected by means of a Scheme of Arrangement
under Part 26 of the Companies Act 2006

1.    Introduction

The boards of William Hill, GVC and Sportingbet are pleased to announce that they have reached agreement on the terms of a recommended offer pursuant to which GVC will acquire the entire issued and to be issued share capital of Sportingbet and members of the William Hill Group will acquire the Sportingbet Australian Business and certain other assets from the Sportingbet Group and be granted a call option over the Sportingbet Spanish Business. The Offer is to be effected by means of a scheme of arrangement under Part 26 of the Companies Act.

2.    The Offer

Under the terms of the Offer (which will be subject to the conditions and further terms set out in Appendix I to this announcement and to be set out in the Scheme Document) if the Scheme becomes effective, Scheme Shareholders will be entitled to receive:

for each Scheme Share 44.8 pence in cash; and
  0.0435 New GVC Shares

In addition, Sportingbet Shareholders will be entitled to receive and retain the final dividend of 1.1 pence per Sportingbet Share in respect of the year ended 31 July 2012. This dividend will be payable on 17 January 2013 to Sportingbet Shareholders registered as at the close of business on 21 December 2012.

Taking into account this final dividend the Offer values each Sportingbet Share at 56.1 pence, based on a Closing Price per GVC Share of 233.5 pence on 15 October 2012, being the last Business Day prior to the suspension of the GVC Shares. On this basis, the Offer values the entire issued and to be issued share capital of Sportingbet on a fully diluted basis (assuming payment in full to Sportingbet Convertible Bondholders of the Sportingbet Convertible Bonds at their see through conversion value and exercise of all outstanding in the money options and LTIP awards) at approximately £485 million.

Therefore, the Offer (taking into account the Sportingbet final dividend) represents a premium of approximately:

  • 70.0 per cent. to the Closing Price per Sportingbet Share of 33.0 pence on 16 July 2012, being the last Business Day prior to the publication of press speculation that Sportingbet was a potential bid target;
  • 57.1 per cent. to the average Closing Price per Sportingbet Share of 35.7 pence for the three month period ended on 18 September 2012, being the last Business Day prior to the public announcement of William Hill and GVC's interest in Sportingbet;
  • 28.2 per cent. to the Closing Price per Sportingbet Share of 43.8 pence on 18 September 2012, being the last Business Day prior to the public announcement of William Hill and GVC's interest in Sportingbet; and
  • 8.4 per cent. to the Closing Price per Sportingbet Share of 51.8 pence on 19 December 2012, being the last Business Day prior to the making of this announcement.

Through the irrevocable undertakings by certain Sportingbet Shareholders and the cash underpinning and other arrangements that GVC has put in place (as described below), elections by other eligible Scheme Shareholders under the Mix and Match Facility to take up to the entirety of their consideration under the Offer in the form of cash will be satisfied in full, if the elections for New GVC Shares which are committed to under the irrevocable undertakings detailed below are duly made in accordance with their terms.

Following the issue of the Reduction Court Order by the Court and prior to the Effective Time, members of the William Hill Group will acquire the Sportingbet Australian Business, the "miapuesta" brand and certain Guernsey domiciled companies that hold the title to the Guernsey Properties from the Sportingbet Group and be granted a call option over the Sportingbet Spanish Business. At the Effective Time, GVC will acquire the entire issued and to be issued share capital of Sportingbet, which will then be the holding company of the Remaining Sportingbet Businesses.

The New GVC Shares will be issued in registered form and will be capable of being held in both certificated and uncertificated form. Fractions of New GVC Shares will not be allotted or issued to Scheme Shareholders but will be aggregated and sold in the market and the net proceeds of such sale (after deduction of costs and expenses) will be paid in cash to the relevant Scheme Shareholders pro rata to their entitlements (except that amounts of £5 or less will be retained for the benefit of GVC).

The New GVC Shares to be issued to Scheme Shareholders pursuant to the Scheme will rank pari passu with all other GVC Shares in issue on the Effective Date, will be issued free from all liens, charges, encumbrances, equitable interests, rights of pre-emption and any other interests of any nature whatsoever and will rank in full for all dividends or other distributions made, paid or declared after the Effective Date on the ordinary share capital of GVC.

Under the terms of the Offer, Sportingbet Convertible Bondholders will be entitled to receive in cash the amount which represents the see through value of the Sportingbet Convertible Bonds under their terms (based upon the Change of Control Conversion Price) as if the Sportingbet Convertible Bondholders had exercised their right to convert their bonds into Sportingbet Shares at the Effective Date and received cash consideration of 55 pence per resulting Sportingbet Share.

3.    Mix and Match Facility

Scheme Shareholders (other than any Restricted Overseas Shareholders) will, pursuant to the Mix and Match Facility, be entitled to elect, subject to availability, to vary the proportions in which they receive cash and New GVC Shares in respect of their holdings of Scheme Shares on the basis of:

for every 0.0435 New GVC Shares   10.2 pence in cash
  or  
for each 10.2 pence  in cash    0.0435 New GVC Shares

The total number of New GVC Shares to be issued under the Scheme will not be increased as a result of elections under the Mix and Match Facility. Accordingly, elections made by eligible Scheme Shareholders under the Mix and Match Facility for New GVC Shares will only be satisfied to the extent that other eligible Scheme Shareholders make equal and opposite elections under the Mix and Match Facility. To the extent that elections for New GVC Shares cannot be satisfied in full, they will be scaled down on a pro rata basis. As a result, eligible Scheme Shareholders who make an election for New GVC Shares under the Mix and Match Facility will not know the exact number of New GVC Shares they will receive until settlement of the consideration due to them in respect of the Scheme.

The Mix and Match Facility is conditional upon the Scheme becoming effective and further details of the Mix and Match Facility will be included in the Scheme Document.

Through the irrevocable undertakings by certain Sportingbet Shareholders and the cash underpinning and other arrangements that GVC has put in place (as described below), elections by other eligible Scheme Shareholders under the Mix and Match Facility to take up to the entirety of their consideration under the Offer in the form of cash will be satisfied in full, if the elections for New GVC Shares which are committed to under the irrevocable undertakings detailed below are duly made in accordance with their terms.

Henderson Global Investors, which through the Volantis Capital team exercises investment management control over 10,102,999 Sportingbet Shares, representing approximately 1.5 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement), has executed an irrevocable undertaking consenting to the Scheme and undertaking to be bound by it and undertaking to vote in favour of the Sportingbet Shareholder Resolution to be proposed at the Sportingbet General Meeting and also to elect under the Mix and Match Facility to take the entirety of the consideration attributable to such Sportingbet Shares under the Offer in the form of New GVC Shares.

Certain other Sportingbet Shareholders (namely DBS Advisors, Mark Blandford (with family trusts) and Rockridge Investments) who hold or are beneficially entitled to 63,460,735 Sportingbet Shares in aggregate, representing approximately 9.5 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement) have executed irrevocable undertakings to vote both in favour of the Scheme and in favour of the Sportingbet Shareholder Resolution, and also to elect under the Mix and Match Facility to take the entirety of their consideration under the Offer in the form of New GVC Shares.

In addition, Bonaire Investment Holdings Ltd, which holds or is beneficially entitled to 45,045,275 Sportingbet Shares, representing approximately 6.8 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement), has executed an irrevocable undertaking to vote both in favour of the Scheme and in favour of the Sportingbet Shareholder Resolution, and also elect to take a minimum of 1,100,000 New GVC Shares under the Mix and Match Facility as its consideration under the Offer.

In addition, GVC has entered into cash underpinning arrangements with Henderson AIA and also with Richard Griffiths and Antisoma plc (who are respectively a controlling shareholder of, and a company connected to, Ora Capital) whereby if, notwithstanding the irrevocable commitments to elect for New GVC Shares referred to above (and other eligible Scheme Shareholders either making no election under the Mix and Match Facility or making an election for an increased proportion of New GVC Shares), the Mix and Match Facility does not operate so as to deliver to any eligible Scheme Shareholders the full amount of cash consideration for which they have elected, Henderson AIA, Richard Griffiths and Antisoma plc will acquire for cash (at a price of 233.5 pence per New GVC Share) the New GVC Shares otherwise attributable to such eligible Scheme Shareholders (or such of those shares as those eligible Scheme Shareholders have elected not to receive). This will result in additional cash being available to those eligible Scheme Shareholders whose elections for cash have not been satisfied through the operation of the Mix and Match Facility. The maximum commitments of Henderson AIA, Richard Griffiths and Antisoma plc under these cash underpinning arrangements are in respect of 5,000,000 New GVC Shares, 783,725 New GVC Shares and 1,713,062 New GVC Shares respectively.

Further, to the extent that eligible Scheme Shareholders elect for cash consideration, and such elections cannot otherwise be satisfied pursuant to the operation of the Mix and Match Facility and the cash underpinning arrangements referred to above, GVC will make an amount of up to £7.226 million available pursuant to the Offer to satisfy such elections (and accordingly will not issue up to 3,094,229 New GVC Shares which would otherwise have been issued to such Scheme Shareholders).

The ability of eligible Scheme Shareholders to receive their consideration in the form of cash if they elect to do so under the Mix and Match Facility will be dependent on the irrevocable undertakings provided by certain Sportingbet Shareholders to elect for New GVC Shares (as detailed above) being complied with in accordance with their terms or, failing that, on sufficient elections for New GVC Shares being made by other eligible Scheme Shareholders.

Each of the Sportingbet Shareholders who has irrevocably undertaken to elect under the Mix and Match Facility to take the entirety of its consideration under the Offer in the form of New GVC Shares, or to receive as consideration not less than a specified minimum number of New GVC Shares, has also undertaken to deliver a Form of Election to this effect within seven days after the posting of the Scheme Document. In the event that any such Form of Election is not duly received within this seven day period, an appropriate announcement will be made pursuant to Rule 2.11 of the City Code.

The cash underpinning arrangements with Richard Griffiths and Antisoma plc fall to be treated as a related party transaction pursuant to the AIM Rules by virtue of the shareholding of Ora Capital in GVC (amounting to approximately 18.9 per cent. of GVC's share capital in issue on 19 December 2012, being the last Business Day prior to the making of this announcement). The GVC Directors consider, having consulted with Daniel Stewart (GVC's Nominated Adviser), that the terms of the cash underpinning arrangements are fair and reasonable insofar as the GVC Shareholders are concerned.

By virtue of the cash underpinning arrangements with Henderson AIA and the shareholding in Sportingbet of Henderson Global Investors, Henderson Group plc and its subsidiaries are deemed to be acting in concert with William Hill Australia and GVC for the purposes of the City Code.

Restricted Overseas Shareholders will not be entitled to participate in the Mix and Match Facility and, if the Scheme becomes effective, will receive for each Scheme Share held by them the basic consideration of 44.8 pence in cash and a further sum of cash based upon the proceeds of the sale of 0.0435 New GVC Shares in the market.

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4.    Irrevocable undertakings in relation to the Offer

William Hill and GVC have received irrevocable undertakings in support of the Scheme in relation to an aggregate of 153,574,208 Sportingbet Shares, representing approximately 23.0 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement).

Within these totals are irrevocable undertakings from those of the Sportingbet Directors who beneficially own or control, and can procure the voting of, Scheme Shares in respect of an aggregate of 5,492,756 Sportingbet Shares, representing approximately 0.8 per cent. of Sportingbet's share capital in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement).

Henderson Global Investors, which through the Volantis Capital team exercises investment management control over 10,102,999 Sportingbet Shares, representing approximately 1.5 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement), has executed an irrevocable undertaking consenting to the Scheme and undertaking to be bound by it and undertaking to vote in favour of the Sportingbet Shareholder Resolution to be proposed at the Sportingbet General Meeting.

Certain other Sportingbet Shareholders (namely Bonaire Investment Holdings Ltd, UBS Global Asset Management, DBS Advisors Ltd., Mark Blandford (with family trusts) and Rockridge Investments S.A.) who hold or are beneficially entitled to, or exercise management control over, 137,978,453 Sportingbet Shares in aggregate, representing approximately 20.7 per cent. of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement), have executed irrevocable undertakings to vote in favour of the Scheme and in favour of the Sportingbet Shareholder Resolution.

Further details of these irrevocable undertakings (including the circumstances in which certain of them may lapse) are set out in Part A of Appendix III to this announcement.

GVC has received irrevocable undertakings to vote in favour of the GVC Shareholder Resolution to be proposed at the GVC General Meeting, in respect of an aggregate of 16,377,994 GVC Shares, representing approximately 51.8 per cent. of the share capital of GVC in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement).

Within this total are irrevocable undertakings from those of the GVC Directors who beneficially own or control, and can procure the voting of, GVC Shares in respect of an aggregate of 522,033 GVC Shares, representing approximately 1.7 per cent. of GVC's share capital in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement).

The remainder of the irrevocable undertakings received by GVC have been given by certain GVC Shareholders (namely Henderson Global Investors, Ora Capital and Audley Capital Management Limited) in respect of an aggregate of 15,855,961 GVC Shares, representing approximately 50.2 per cent. of GVC's share capital in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement).

Further details of these irrevocable undertakings (including the circumstances in which certain of them may lapse) are set out in Part B of Appendix III to this announcement.

5.    Background to and reasons for the Offer

The combination of William Hill and GVC represents a highly credible acquirer of Sportingbet, with the relevant knowledge, strategic intent and financial capability to complete the transaction.

William Hill and GVC have carried out a comprehensive evaluation of Sportingbet and believe that the business has a number of attractive characteristics including a full product offering and extensive geographic coverage as well as an industry-leading trading platform. However, it is also clear that Sportingbet comprises two very distinct businesses: (i) a highly profitable, licensed Australian business and other licensed activities in markets such as Spain; and (ii) a European and Emerging Markets business which is much less profitable and currently heavily impacted by the evolving nature of the regulatory position in a number of its key markets.

William Hill

For William Hill, Australia is one of the most attractive online locally licensed markets where at present it does not have a footprint. The Australian betting market is one of the largest licensed betting markets in the world and William Hill has particular skills in those areas of the market that are demonstrating strong structural growth: online, mobile, fixed odds and sports (non-horse racing) betting. William Hill believes it has the resources and expertise to continue to grow the Sportingbet Australian Business successfully, building on its existing strong market position. William Hill has also recently entered the licensed online Spanish gambling market on an organic basis. The acquisition of the Sportingbet Spanish business is expected to allow William Hill to achieve critical mass in the market faster than it otherwise would have done.

Overall, William Hill believes that the acquisition of the Regulated Sportingbet Businesses will further develop the William Hill Group's online and multi-channel operations (increasing the proportion of William Hill Group Operating Profits from online activities to over 40 per cent. on a pro forma basis) and increase the William Hill Group's exposure to attractive locally licensed jurisdictions and its geographic diversification, all of which are central elements to the William Hill board's strategy. In doing so, the William Hill board believes that William Hill is well placed to create further value for its shareholders.

Members of the William Hill Group other than William Hill Online will initially be acquiring, or being granted a call option over, the Regulated Sportingbet Businesses.

The proposed acquisition is expected to be enhancing to underlying earnings (before transaction and integration costs and the amortisation of intangible assets associated with the proposed acquisition) in the first full year (note: this is not intended to be a profit forecast or imply that future profits will necessarily be greater than historical profits). Post-tax return on invested capital is expected to meet prospective weighted average cost of capital in the third full year of ownership. On a pro forma basis, the peak net debt to EBITDA ratio for William Hill is expected to be 2.6x in the middle of 2013, falling to 2.5x by the end of 2013.

GVC

The strategy of GVC is to generate returns from highly cash generative internet gaming and gambling brands. GVC seeks to generate these returns by (i) making direct investments, where the GVC Group owns and operates the brands itself - the Business to Consumer or "B2C" business segment; or (ii) providing extensive back-office services to brands owned by third party companies - the Business to Business or "B2B" business segment.

The "B2C" segment of GVC currently includes the brands CasinoClub, a leading casino brand targeting German speaking markets, and Betboo, a mix of sports and gaming products that targets the Brazilian marketplace. The "B2B" segment currently includes the service revenue from East Pioneer Corporation B.V., the independent company to whom Sportingbet sold its Turkish language business on 21 November 2011.

The GVC Group has shown that while it will invest in cash generative ventures, it will equally divest itself of ventures which it believes have either ceased being cash generative or show no sign of becoming cash generative in the medium-term. For example, in April 2012 GVC announced the disposal of the Betaland business due to poor prospects regarding growth and cash collectability.

In line with GVC's strategy, the acquisition of the Remaining Sportingbet Businesses will result in a number of benefits to GVC, including the following:

  • the Remaining Sportingbet Businesses include operations in a number of jurisdictions where Sportingbet does not have a local licence that will complement the existing profile of the GVC Group. In addition, the combination of the Remaining Sportingbet Businesses with the existing business of GVC will consolidate GVC's position as one of the leading operators in markets which may soon be locally licensed;
  • GVC believes there are number of web-domains within Sportingbet's existing portfolio which are not realising in full their potential value;
  • the Remaining Sportingbet Businesses have an existing market leading sportsbook platform and trading team. GVC believes there is potential to leverage this platform further to provide additional growth. Also, there should be opportunities for synergies with GVC's existing sportsbook;
  • the mitigation of the earn-out liabilities for the Superbahis brand. On 21 November 2011, Sportingbet sold the Turkish language website, Superbahis, to EPC. The consideration for the disposal was structured on a deferred earn-out basis entitling Sportingbet to approximately 75 per cent. of the combined net gaming revenue of the Superbahis business and GVC's Betboo business. EPC continues to pay that deferred consideration to Sportingbet monthly in arrears. Upon the Scheme becoming effective, this deferred consideration will be recoverable by the Enlarged GVC Group; and
  • GVC remains focussed on cash generation. The Directors of GVC believe that the combination of GVC and the Remaining Sportingbet Businesses has the potential to lead to enhanced cash generation opportunities as the two businesses are integrated.
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6.    Recommendation by the Sportingbet Directors

The Sportingbet Directors, who have been so advised by Lazard, consider the terms of the Offer to be fair and reasonable. In providing advice to the Sportingbet Directors, Lazard has taken into account the commercial assessments of the Sportingbet Directors. Accordingly, the Sportingbet Directors intend unanimously to recommend that Scheme Shareholders and Sportingbet Convertible Bondholders vote in favour of the Scheme at the Court Meetings and to recommend that Sportingbet Shareholders vote in favour of the Sportingbet Shareholder Resolution to be proposed at the Sportingbet General Meeting, as the Sportingbet Directors who beneficially own or control, and can procure the voting of, Scheme Shares have irrevocably undertaken to do in respect of their controlled holdings of, in aggregate, 5,492,756 Sportingbet Shares, representing approximately 0.8 per cent of the share capital of Sportingbet in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement).

The Sportingbet Directors do not intend to make any recommendation to eligible Scheme Shareholders as to whether or not they should make any particular election under the Mix and Match Facility. In determining whether to make any election under the Mix and Match Facility, eligible Scheme Shareholders should pay particular consideration to the contents of the GVC Prospectus which will accompany the Scheme Document to be sent to Scheme Shareholders in due course.

7.    Background to and reasons for the Recommendation by Sportingbet

Following the initial approach to the board of Sportingbet by William Hill and GVC on 21 September 2012, the Sportingbet Directors have held detailed discussions with William Hill and GVC regarding the terms of a potential acquisition. These discussions have resulted in an Offer of 56.1 pence that comprises 44.8 pence in cash and 0.0435 New GVC Shares per Scheme Share, plus an entitlement for Sportingbet Shareholders to receive and retain the previously announced 1.1 pence per share final cash dividend in respect of the year ended 31 July 2012.

The Sportingbet board has evaluated proposals on behalf of Sportingbet Shareholders as a whole. Whilst the Sportingbet Directors believe that Sportingbet's prospects as an independent company remain strong, particularly in Australia following the successful acquisition and integration of Centrebet International Limited in 2011, and the potential upside opportunities that exist in Europe and the emerging markets, the Sportingbet Directors have taken into careful consideration the continued challenging macroeconomic conditions and the outlook for Sportingbet. The Board believes the Offer represents attractive value for Sportingbet Shareholders given these macro-economic uncertainties. In addition, as a result of the irrevocable undertakings and cash underpinning and other arrangements described in paragraph 3 above, eligible Sportingbet Shareholders who elect to take their consideration in cash will be able to elect to increase their cash payment to 55 pence per Scheme Share (excluding any cash receivable in respect of the final dividend), thereby providing an opportunity to exit from their investment in Sportingbet wholly in cash, if the elections for New GVC Shares which are committed to under the irrevocable undertakings detailed above are duly made in accordance with their terms.

The Sportingbet Directors believe that Scheme Shareholders and Sportingbet Convertible Bondholders should now be given the opportunity to realise value from their investment. The board of Sportingbet has also taken into account that the terms of the Offer represent a significant premium to the recent share price and that the Offer represents a premium of 57.1 per cent. to the average Closing Price per Sportingbet Share of 35.7 pence for the three month period ended on 18 September 2012, being the last Business Day prior to the public announcement of William Hill and GVC's interest in Sportingbet.

8.    Recommendation by the GVC Directors

The GVC Directors intend unanimously to recommend that GVC Shareholders vote in favour of the GVC Shareholder Resolution to be proposed at the GVC General Meeting, as the GVC Directors who beneficially own or control, and can procure the voting of, GVC Shares have irrevocably undertaken to do in respect of their controlled holdings of, in aggregate, 522,033 GVC Shares, representing approximately 1.7 per cent. of the share capital of GVC in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement).

In the event that, prior to the Effective Time, a third party offer for GVC is announced (or GVC is approached concerning a potential offer), the GVC Directors' recommendation is not made, is withdrawn or adversely modified or qualified, and the Offer lapses, GVC has agreed to pay a fee of £5 million to William Hill.

9.    Information relating to William Hill

William Hill is one of the world's leading betting and gaming companies, employing more than 15,000 people. Founded in 1934, it is now the UK's largest bookmaker with 2,370 licensed betting offices that provide betting opportunities on a wide range of sporting and non-sporting events, gaming on machines and numbers-based products including lotteries. William Hill Online (www.williamhill.com) is one of Europe's leading online betting and gaming businesses, providing customers with the opportunity to access William Hill's products online, through their mobile, by telephone and by text services.

During its 2011 financial year, William Hill generated turnover of £1.14 billion and profit before tax of £187 million.

William Hill shares are traded on the London Stock Exchange and the company is a member of the FTSE 250 index.

10.    Information relating to GVC

GVC is a leading provider of B2B and B2C services to the online gaming and sports betting markets and its shares have been traded on AIM since 2004. The GVC Group has two principal operating divisions: B2B and B2C, along with a central support function. The B2C business unit consists of Casino Club, an online casino operating principally in German speaking markets; Betboo, offering a sports book and bingo operation on its own platform along with casino and poker on third party platforms to mainly Brazilian customers; and, until 10 April 2012, Betaland, a sports and gaming operation focusing on offline agent-derived Italian business.

The B2B business unit consists principally of the third party support contract for East Pioneer Corporation B.V., which acquired the Superbahis brand from Sportingbet in November 2011. B2B also includes the GVC Group's operations in the same geographical markets as Superbahis, although these are relatively small.

For the year ended 31 December 2011, GVC generated a clean EBITDA (defined as earnings before interest, taxation, depreciation and amortisation and before exceptional items and share option charges) of €10.0 million on revenues of €64.3 million.

11.    Information relating to Sportingbet

Sportingbet is an online sports betting and gaming group focused on the European and Australian markets, supplemented by an emerging markets business. The Sportingbet Group facilitates online sports betting, casino, poker and gaming through a range of branded websites. As at 19 December 2012, Sportingbet operated websites in 23 different languages, targeting 26 countries.The Sportingbet Group currently holds betting and gaming licences and approvals in Alderney, Australia, Denmark, Ireland, Italy, Malta, South Africa, Spain and the UK.

For the year ended 31 July 2012, Sportingbet generated EBITDA of £56.8 million (adjusted for exceptional items, share option charge and amortisation of other intangible assets) on Amounts Wagered of £2,349.2 million.

12.    Information relating to the Regulated Sportingbet Businesses

The Regulated Sportingbet Businesses to be acquired by the William Hill Group principally comprise:

Sportingbet Australian Business:

The Sportingbet Australian Business is one of the leading online corporate bookmakers in Australia. It is based in Darwin and Sydney, operating under a licence provided by the Northern Territory Government, with approximately 210 employees. The business comprises the "Sportingbet" and, since August 2011, "Centrebet" brands in the Australian market, offering sports betting products via online, mobile and telephone channels. In August 2012, online and mobile channels represented approximately 59 per cent. and 34 per cent. respectively of total net gaming revenue (post gaming tax), which has grown significantly over the last few years driven by an increase in mobile revenue at the expense of the lower margin telephone revenue. At the same time, the business has seen an increasing proportion of recreational, lower spending customers within the group's revenues.

The business currently offers sports betting only. Under the terms of the existing licence, online in-play betting, casino, games and poker are not currently permitted.

The integration of Centrebet was successfully completed in June 2012, with both brands now operating on Sportingbet's proprietary owned IT platform. Both the "Sportingbet" and "Centrebet" brands have been retained and are targeted at different and complementary segments of the gaming market. The Sportingbet brand has historically focused on targeting players with a diverse product offering, with a particular focus on horse racing, with around 62 per cent. of its turnover via online and mobile and 38 per cent. via telephone, in the year ended 31 July 2012. The Centrebet brand has been more balanced between sports and racing in terms of product offering, with around 84 per cent. of its turnover via the internet and mobile in the year ended 31 July 2012.

For the year ended 31 July 2012, the Sportingbet Australian Business had approximately 172,000 sports active customers (compared to approximately 82,200 sports active customers in the prior year). These sports active customers each generated an average net gaming revenue (post gaming tax) for the year to 31 July 2012 of £508 (compared to £489 in the prior year). The business generated an overall sports margin (post gaming tax) in the year ended 31 July 2012 of 5.8 per cent. (compared to 4.9 per cent. in the prior year). The KPIs for the Sportingbet Australian Business for the year ended 31 July 2012 are as follows:

  Internet Telephone Mobile
Sports bets (m) 39.2 1.5 7.7
Sports bets / active 262 50 85
Sports bet size (A$) 34 445 37
Sports margin (post gaming tax) % 6.8 2.6 8.5

For the financial year ended 31 July 2012, the Sportingbet Australian Business had net gaming revenue (post gaming tax) of £87.4 million and EBITDA of £34.8 million.

Sportingbet Spanish Business:

The Sportingbet Spanish Business operates under the long established "miapuesta" brand through both mobile and online platforms, offering regulated gaming products in both sports and casino.

A new online gambling regulatory regime was introduced in Spain in early June 2012. In the months preceding this liberalisation of the gambling market, the operations of the Sportingbet Spanish Business was temporarily suspended due to an injunction from a Spanish land based casino operator. The business was awarded a provisional Spanish egaming licence on 1 June 2012.

If William Hill were to exercise its call option in respect of the Sportingbet Spanish Business, it would result in a significant enlargement of the net gaming revenues generated by the Wider William Hill Group in the Spanish market.

13.    Information relating to the Remaining Sportingbet Businesses

The Remaining Sportingbet Businesses, which will be acquired by GVC, facilitate online sports betting, casino, poker and gaming through a range of branded websites, targeting 24 countries covering Europe and some emerging markets, in 23 different languages. The most notable jurisdictions in which substantial revenues are accepted are Brazil, Bulgaria, Czech Republic, Germany, Greece, Poland, Russia and the UK.

Betting and gaming licences and approvals are held in Alderney, Denmark, Ireland, Italy, Malta, South Africa, and the UK.

The geographically diverse customer base aims to minimise the impact to the overall business of any changes in the operating environment that may occur in a particular country from time to time.

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Sports betting

Sports betting gaming services are provided through a number of websites, localised to fit the target market. In the majority of territories, these websites are branded Sportingbet.com although a strategy of localisation in certain territories has allowed for a build up of significant businesses in a number of European countries.

Casino and games

Casino and gaming products are offered to the customer base in all target markets. In South Africa, the local licence is restricted to online sports betting only.

A full suite of over 100 download and instant play casino and games under the ParadiseCasino brand are offered. ParadiseCasino provides all the popular casino table games such as blackjack and roulette as well as slots with progressive jackpots and other betting games. In 2010, the casino offering was extended by adding a "live dealer" casino to its product suite. In "live dealer", players bet electronically on casino table games that take place physically, in real time, in a studio and are then streamed live on the web. This provides some customers with a greater degree of visibility over the outcome of the games rather than relying exclusively on the software generated outcomes.

Poker

Online poker is offered to customers through the ParadisePoker brand.  ParadisePoker offers a variety of popular multi-player poker games such as Texas Hold'em, Omaha, seven card stud and five card draw. In online poker, players play in real-time against other players with the operator charging a commission for hosting and facilitating the games known as the "rake". As such, in contrast with the sports betting product, there is no financial risk to the operator. Players can compete against each other on individual tables ("ring games"), where up to ten players play on each table, or participate in tournaments where individuals compete against each other on a single-table or multi-table knockout basis.

The poker software is provided by Boss Media (who operate the International Poker Network ("IPN")) and Entraction. Customers play against players from other poker operators in the poker network in order to generate larger player pools. Large player pools or greater "liquidity" allows players to find the game they want, within the betting limits they want to play, and at the time they wish to play. As prize pools are generated by player entry fees, larger player pools also provide for larger prize funds. The IPN is one of the largest poker networks according to pokerscout.com.

In the financial year ended 31 July 2012, the Remaining Sportingbet Businesses had net gaming revenue of £90 million and EBITDA of £5.5 million.

14.    Separation of the Regulated Sportingbet Businesses and Remaining Sportingbet Businesses

Following the issue of the Reduction Court Order by the Court and prior to the Effective Time, and pursuant to the terms of the Transfer Agreement, the William Hill Group will acquire the subsidiary companies of Sportingbet that comprise the Sportingbet Australian Business and will be granted (for no additional consideration) a call option to acquire, no earlier than six months following the Effective Time, the business and assets that comprise the Sportingbet Spanish Business. The William Hill Group will also at that time acquire the "miapuesta" brand and certain Guernsey domiciled companies that hold the title to the Guernsey Properties.

The Sportingbet Spanish Business will not transfer automatically to the William Hill Group at the Effective Time. Pursuant to the Transfer Agreement, certain brands used in the Sportingbet Spanish Business will be transferred to the William Hill Group just prior to the Effective Time, and licensed back to Sportingbet to be used in the Sportingbet Spanish Business, and the remaining assets that comprise the Spanish Regulated Business will become the subject of the call option in favour of the William Hill Group which, absent agreement to the contrary between William Hill and GVC, will be exercised no earlier than six months from the Effective Time.

In order to effect the Offer, William Hill will make an additional consideration payment of £36.5 million to GVC, part of which will be used to discharge bank indebtedness of the Sportingbet Group which exists as at the Effective Time. As a result, the total expected cash consideration paid by William Hill in relation to the acquisition of the Regulated Sportingbet Businesses is approximately £454 million, which excludes estimated exceptional transaction fees of approximately £16 million. William Hill will separately provide a loan facility of up to £15 million at completion (subject to a further adjustment of up to £5 million post completion) to GVC to cover expected working capital fluctuations and other cash commitments. If GVC draws down on this facility, it will be repaid under an agreed mechanism ending 30 June 2016.

15.    Management, employees and locations of business

As described above, the Regulated Sportingbet Businesses will be transferred to the William Hill Group, while the Remaining Sportingbet Businesses will become part of the Enlarged GVC Group.

Sportingbet Australian Business

The Sportingbet Australian Business has a well-established and highly experienced senior management team, who will continue to operate the business under William Hill's ownership. William Hill has agreed and entered into new long-term retention and incentivisation arrangements with certain members of Sportingbet's Australian management team. Further details on these arrangements will be provided in the Scheme Document.

William Hill attaches great importance to the skills, experience and knowledge of the existing management and employees of the Sportingbet Australian Business, who have contributed to the success of the business to date. Moreover, as William Hill's current operations do not encompass the Australian market, William Hill will not be required to integrate the Sportingbet Australian Business into its own Australian operations and expects to continue to run the Sportingbet Australian Business on a largely continuous basis.

Following the transfer of the Sportingbet Australian Business to the William Hill Group, William Hill will, together with Australian management, undertake a review of the operations of the Sportingbet Australian Business with a view to deriving benefits over the next few years for the Wider William Hill Group and potentially avoiding unnecessary overlap with William Hill's own group functions. Until this review is complete, no decisions have been made in connection with the employment of those employees employed in the Sportingbet Australian Business, the location of the places of business, or the redeployment of the fixed assets of the Sportingbet Australian Business.

Sportingbet Spanish Business

William Hill and GVC have been informed by Sportingbet that only a limited number of employees are currently designated full time to the operation of the Sportingbet Spanish Business.

Pursuant to the Transfer Agreement, William Hill and GVC will work together prior to the date of exercising the call option to agree an appropriate migration plan for the transfer of the Sportingbet Spanish Business to William Hill. Until this migration plan is complete, no decisions have been made in connection with the employment of those employees employed in the Sportingbet Spanish Business, the location of the places of business, or the redeployment of the fixed assets of the Sportingbet Spanish Business.

William Hill is of the view that any Sportingbet employees in relation to the Australian and Spanish business transferred to William Hill will benefit from the greater opportunities afforded by their employment in the enlarged William Hill Group.

The board of William Hill has confirmed that, following the date of Admission, the existing employment rights, including pension rights, of all of Sportingbet's employees employed within the Regulated Sportingbet Business will be safeguarded.  The board of William Hill has further confirmed that, following the date of Admission, all employees of the Sportingbet Australian Business will become employed within the enlarged William Hill Group on their existing employment terms and conditions, save in respect of the new long-term retention and incentivisation arrangements with the management team referred to above, and that there are no material changes in their employment terms and conditions envisaged.

Remaining Sportingbet Businesses

GVC believes that the combination of its existing operations with those of the Remaining Sportingbet Businesses shall result in opportunities for many employees in the Enlarged GVC Group in the future.

However, GVC also recognises that in order to achieve the planned benefits of the Offer, including deriving any available cost synergies, operational restructuring will be required. Following the Effective Date, GVC will seek to integrate the respective operations of the GVC Group and the Remaining Sportingbet Businesses (including customer services, sales, accounting, finance, legal, IT, human resources and marketing functions). This is likely to lead to redundancies where the businesses have overlapping functions or where this would otherwise improve efficiency. In addition, GVC expects changes to the principal locations of business of the Remaining Sportingbet Businesses and may redeploy the fixed assets of the Remaining Sportingbet Businesses. However, save as set out below, specific proposals have not yet been identified by GVC:

  • It is envisaged that the executive directors of Sportingbet will vacate office and leave employment immediately upon Admission. The board of GVC has confirmed that all payments and benefits which will fall due to the executive directors of Sportingbet on the termination of their employment under their existing arrangements will be made in full, save that the executive directors have waived any eligibility they may have to any payment under Sportingbet's current redundancy policy;
  • The non-executive directors of Sportingbet have agreed to resign with effect from the date of Admission. The board of GVC has confirmed that all payments which fall due to non-executive directors of Sportingbet on the termination of their directorships under their existing terms of appointment will be made in full as a lump sum. Peter Dicks will receive the sum of £55,000 pursuant to an agreement made with Sportingbet in 2007;
  • In addition to the costs of the Sportingbet Directors, GVC will also review the central costs of Sportingbet, including the head office costs, in particular those associated with Sportingbet having been listed on the Official List of the London Stock Exchange; and
  • GVC will look to rationalise the locations of business of the GVC Group and the Remaining Sportingbet Businesses. The board of GVC has confirmed that a number of senior managers will leave by reason of redundancy in the period following the date of Admission and discussions are underway with the relevant individuals.

The board of GVC has confirmed to the Sportingbet Directors that the existing employment rights, including pension rights, of all employees employed within the Remaining Sportingbet Businesses will be safeguarded.

The board of GVC has confirmed that, following the date of Admission, all of the employees of the Remaining Sportingbet Businesses will become employed within the Enlarged GVC Group on their existing terms and conditions and that there are no material changes in their employment terms and conditions envisaged.

The boards of William Hill and GVC have also confirmed that, in relation to any redundancies which are considered necessary in any jurisdiction, enhanced payments will be made to all impacted employees in accordance with the terms of the redundancy policy most recently applied by Sportingbet in the relevant jurisdiction.  

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16.    Dividends

Sportingbet has previously announced a final dividend of 1.1 pence in respect of the year ended 31 July 2012. This dividend will be payable on 17 January 2013 to Sportingbet Shareholders registered as of the close of business on 21 December 2012 (who will be entitled, under the terms of the Offer, to receive and retain such dividend).

17.    Sportingbet Convertible Bonds

As part of the Scheme, a court convened meeting of the Sportingbet Convertible Bondholders will be held. A majority in number of those Sportingbet Convertible Bondholders who are present (either in person or by proxy) and who vote at the Sportingbet Convertible Bond Court Meeting, representing at least 75 per cent. in value of the Sportingbet Convertible Bonds voted, will be required for approval of the Scheme by Sportingbet Convertible Bondholders. The Scheme Document will include full details of the Scheme as it relates to Sportingbet Convertible Bondholders.

As a result of the Scheme becoming effective, Sportingbet Convertible Bondholders will be entitled to an enhanced conversion rate on the change of control of Sportingbet as compared to the conversion rate formula that would apply if a Sportingbet Convertible Bondholder exercised its right to convert Sportingbet Convertible Bonds into Sportingbet Shares prior to the Effective Date. Under the terms of the Offer, Sportingbet Convertible Bondholders will be entitled to receive the cash amount which represents the see through value of the Sportingbet Convertible Bonds under their terms and based upon the more favourable Change of Control Conversion Price as if the Sportingbet Convertible Bondholders had exercised their right to convert their bonds into Sportingbet Shares at the Effective Date and received under the Offer cash consideration of 55 pence per resulting Sportingbet Share. Sportingbet Convertible Bondholders will not be entitled to participate in the Mix and Match Facility.

Further details of the terms of the Offer to be made to Sportingbet Convertible Bondholders will be set out in the Scheme Document, including the consideration to be paid in respect of each £100,000 of Sportingbet Convertible Bonds held.

18.    Sportingbet Share Plans

The Offer will affect options and awards granted under the Sportingbet Share Plans. Participants in the Sportingbet Share Plans will be contacted regarding the effect of the Offer on their rights under the Sportingbet Share Plans and appropriate proposals will be made to such participants in due course. It is not expected that such proposals will be made immediately, but they will be made in advance of the Scheme becoming effective.

19.    Financing

The cash consideration payable by GVC to Scheme Shareholders under the Offer will be financed through a payment made to GVC by William Hill Australia under the Transfer Agreement (which payment will be funded by William Hill froman existing revolving credit facility of the William Hill Group with a consortium of banks and a new term loan with Lloyds, Barclays and Royal Bank of Scotland) and through the cash underpinning arrangements with Henderson AIA, Richard Griffiths and Antisoma plc described in paragraph 3 above. The funding required for the cash consideration payable under the Offer by William Hill Australia to Sportingbet Convertible Bondholders will be funded from the William Hill Group's own resources and the same loan facilities.  

Citigroup Global Markets Limited, as financial adviser to William Hill, is satisfied that sufficient resources are available to satisfy in full the cash consideration payable to Sportingbet Shareholders and to Sportingbet Convertible Bondholders under the terms of the Offer.

20.    Structure of the Offer

It is intended that the Offer will be implemented by way of a Court-sanctioned scheme of arrangement, between Sportingbet and the Scheme Shareholders and the Sportingbet Convertible Bondholders, under Part 26 of the Companies Act.

The purpose of the Scheme is to provide for GVC to become the holder of the entire issued and to be issued share capital of Sportingbet and for certain members of the William Hill Group to acquire the Sportingbet Australian Business and the Guernsey Properties, and to be granted (for no additional consideration) a call option in respect of the Sportingbet Spanish Business, pursuant to the terms of the Transfer Agreement.

Pursuant to the Scheme, GVC will acquire the entire issued and to be issued share capital of Sportingbet. To become effective, the Scheme will require approval by a majority in number of those Scheme Shareholders who are present (either in person or by proxy) and who vote at the Shareholder Court Meeting, representing at least 75 per cent. in value of the Scheme Shares voted. Henderson Global Investors is not entitled to vote at the Shareholder Court Meeting in respect of the Sportingbet Shares it controls through the Volantis Capital team, but as explained above it has consented to and undertaken to be bound by the terms of the Scheme. The Scheme will also be subject to the passing at the Sportingbet General Meeting, as a special resolution, of the Sportingbet Shareholder Resolution. In addition, approval of the Sportingbet Convertible Bondholders will be sought at the Sportingbet Convertible Bond Court Meeting. The Scheme Document will include full details of the Scheme and of the expected timetable of the Scheme, together with notices of the Shareholder Court Meeting, the Sportingbet General Meeting and the Sportingbet Convertible Bond Court Meeting.

The Scheme will also be subject to the conditions and further terms set out in Appendix I to this announcement and to be set out in the Scheme Document. These conditions provide, among other things, that the Offer will lapse if the Scheme does not become effective by 6.00 p.m. on the Long Stop Date.

Once the necessary approvals from Sportingbet Shareholders and Sportingbet Convertible Bondholders have been obtained, and the other conditions of the Scheme have been satisfied or (where applicable) waived, the Scheme must be approved by the Court. The Scheme and Reduction of Capital will become fully effective upon filing (or, if so ordered by the Court in the case of the Reduction of Capital, upon registration of the Reduction Court Order) of copies of the Court Orders with the Registrar of Companies. Subject to satisfaction or (where applicable) waiver of the conditions referred to above, the Scheme is expected to become fully operative during March 2013.

Upon the Scheme becoming effective, it will be binding on all Scheme Shareholders and Sportingbet Convertible Bondholders, irrespective of whether or not they attended or voted at the Shareholder Court Meeting or the Sportingbet General Meeting (or, in the case of Sportingbet Convertible Bondholders, at the Sportingbet Convertible Bond Court Meeting) and, if they attended and voted, whether or not they voted in favour.

It is expected that the Scheme Document will be despatched to Sportingbet Shareholders and Sportingbet Convertible Bondholders on or around 15 January 2013.

21.    GVC Shareholder approval

In view of the size of the transaction, the Offer constitutes a "reverse takeover" (as defined in the AIM Rules) for GVC. Accordingly, GVC will be required to seek at the GVC General Meeting the approval of GVC Shareholders for the Offer. GVC is required to prepare and send to GVC Shareholders a circular summarising the background to and reasons for the Offer (which will include a notice convening the GVC General Meeting). The Scheme will be conditional upon, amongst other things, the passing by the requisite majority at the GVC General Meeting of resolutions to approve the Offer and increase GVC's authorised share capital so as to allow the allotment of New GVC Shares pursuant to the Offer. The Scheme will not, however, be conditional upon the passing of any other resolutions which may be proposed at the GVC General Meeting.

The GVC Shareholder Circular containing notice of the GVC General Meeting will be sent to GVC Shareholders at the same time as the Scheme Document is posted to Sportingbet Shareholders and Sportingbet Convertible Bondholders, which is expected to be on or around 15 January 2013. It is expected that the GVC General Meeting will be held on or around 7 February 2013.

GVC will also be required to publish the GVC Prospectus (which will also constitute GVC's Admission Document for the purposes of the AIM Rules) in accordance with the Prospectus Rules. The GVC Prospectus will contain information relating to the Enlarged GVC Group and the New GVC Shares. It is expected that the GVC Prospectus will be published at the same time as the Scheme Document is posted to Sportingbet Shareholders and Sportingbet Convertible Bondholders and the GVC Shareholder Circular is posted to GVC Shareholders.

GVC Shareholders representing approximately 51.8 per cent. of the GVC Shares in issue on 19 December 2012 (being the last Business Day prior to the making of this announcement) have irrevocably undertaken to vote in favour of the GVC Shareholder Resolution at the GVC General Meeting.

In the event that, prior to the Effective Time, a third party offer for GVC is announced (or GVC is approached concerning a potential offer), the GVC Directors' recommendation is not made, is withdrawn or adversely modified or qualified, and the Offer lapses, GVC has agreed to pay a fee of £5 million to William Hill.

22.    Offer related arrangements

Confidentiality agreement

Sportingbet, William Hill and GVC entered into a confidentiality agreement on 17 October 2012 pursuant to which each of Sportingbet and William Hill and GVC (acting as partners) has undertaken to the other to keep disclosed information relating to the other party confidential and not to disclose it to third parties (unless required by law or regulation). These confidentiality obligations remain in force for two years following the termination of the agreement, which terminates on the earlier of the date falling 12 months from the execution of the agreement or the completion of the acquisition of Sportingbet by William Hill and GVC.

Incentive plans co-operation agreement

Sportingbet, William Hill and GVC entered into a co-operation agreement (the "Co-operation Agreement") on 20 December 2012 setting out certain agreements between them in relation to the treatment of the Sportingbet Share Plans. The Co-operation Agreement will terminate: (i) if the Scheme is withdrawn or lapses or the Sportingbet board withdraws its recommendation of the Scheme; (ii) if an alternative proposal (as defined in the Co-operation Agreement) becomes or is declared wholly unconditional; (iii) if the Scheme has not become effective by the Long Stop Date; or (iv) if it is so agreed in writing between Sportingbet, William Hill and GVC.

Non-solicitation agreement

Sportingbet and William Hill entered into a non-solicitation agreement on 15 December 2012 pursuant to which William Hill has undertaken to Sportingbet not to employ or engage certain Australian directors and employees of Sportingbet or induce or attempt to induce such directors and employees from leaving their employment other than in certain limited circumstances. These obligations remain in force for one year following the date of the agreement.

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23.    Admission, dealings and settlement of the New GVC Shares

An application, conditional on the Scheme becoming effective, will be made to the London Stock Exchange for the GVC Shares in issue upon the Scheme becoming effective (including the New GVC Shares) to be admitted or re-admitted (as applicable) to trading on AIM. It is expected that Admission will become effective, and that dealings for normal settlement in GVC Shares will commence, at 8.00 a.m. on or shortly after the Effective Date.

24.    De-listing of Sportingbet Shares and Sportingbet Convertible Bonds and re-registration

Prior to the Scheme becoming effective, applications will be made to the UK Listing Authority for the cancellation of the listing of Sportingbet Shares and Sportingbet Convertible Bonds on the Official List and to the London Stock Exchange for the cancellation of trading of Sportingbet Shares on the London Stock Exchange's main market for listed securities and the cancellation of trading of Sportingbet Convertible Bonds on the London Stock Exchange's Professional Securities Market, with effect as at or shortly following the Effective Date.

The last day of dealings in, and for registration of transfers of, Sportingbet Shares and Sportingbet Convertible Bonds is expected to be the Business Day after the Scheme Court Hearing and at the close of business on that day the trading of Sportingbet Shares on the London Stock Exchange's main market for listed securities and of Sportingbet Convertible Bonds on the London Stock Exchange's Professional Securities Market will be suspended. No transfers of Sportingbet Shares or Sportingbet Convertible Bonds will be registered after 6.00 p.m. on that day, other than the registration of Sportingbet Shares released, transferred or issued under the Sportingbet Share Plans.

At the Effective Time, Sportingbet will become a wholly owned subsidiary of GVC and accordingly share certificates in respect of Sportingbet Shares will cease to be valid and should be destroyed and entitlements to Sportingbet Shares held within the CREST system will be cancelled. It is also proposed that, following the Effective Date and after its shares have been delisted, Sportingbet will be re-registered as a private limited company.

25.    Overseas shareholders

The availability of New GVC Shares under the Offer and the Mix and Match Facility to persons who are not resident in, and the distribution of this announcement to persons who are not resident in, the United Kingdom may be affected by the laws of the relevant jurisdiction in which they are located. Such persons should inform themselves of, and observe, any applicable legal or regulatory requirements of their jurisdiction. Sportingbet Shareholders who are in any doubt regarding such matters should consult an appropriate independent professional adviser in the relevant jurisdiction without delay.

This announcement does not constitute an offer for sale of any securities or an offer or an invitation to purchase any securities. Sportingbet Shareholders are advised to read carefully the Scheme Document, the GVC Prospectus, the Forms of Proxy and the Form of Election once these have been dispatched.

26.    Opening Position Disclosures and Interests

William Hill and GVC confirm that they made an Opening Position Disclosure, setting out the details required to be disclosed by them under Rule 8.1(a) of the City Code, on 3 October 2012.   Sportingbet made an Opening Position Disclosure on 28 September 2012.

Save for the irrevocable undertakings referred to in paragraph 4 above, and save for the interest in Sportingbet Shares disclosed by Henderson Global Investors in its announcement made on 13 December 2013 pursuant to Rule 8.3 of the City Code, as at the close of business on 19 December 2012 (being the last Business Day prior to the making of this announcement) neither William Hill nor GVC nor any director of William Hill or GVC nor, so far as the directors of William Hill and GVC are aware, any person acting in concert (within the meaning of the City Code) with William Hill and/or GVC (i) has any interest in, or has any right to subscribe for, any Sportingbet Shares or any other Sportingbet Securities, (ii) has any short position (whether conditional or absolute and whether in the money or otherwise), including any short position under a derivative or arrangement in relation to Sportingbet Securities, or (iii) has borrowed or lent any Sportingbet Securities. For these purposes, "arrangement" includes any indemnity or option arrangement or any agreement or understanding, formal or informal, of whatever nature, relating to Sportingbet Securities which may be an inducement to deal or refrain from dealing in such securities.

27.    Conditions

The Offer will be subject to the conditions and certain further terms set out in Appendix I to this announcement and to be set out in the Scheme Document when issued. These conditions include (a) the approval of Scheme Shareholders and Sportingbet Convertible Bondholders at the Court Meetings and the approval of the Sportingbet Shareholder Resolution at the Sportingbet General Meeting, (b) the approval of the GVC Shareholder Resolution at the GVC General Meeting, (c) the agreement of the London Stock Exchange to Admission, subject only to the Scheme becoming effective and, in the case of New GVC Shares, to allotment, and (d) the obtaining of the Australian Licence Approval and the Australian Foreign Investment Review Board Approval.

If William Hill does not obtain the Australian Licence Approval, the NT Commission may remove the ability of Sportingbet's Australian Business to legally take bets. In these circumstances, and save where the Australian Licence Approval would be obtained if William Hill were to make certain changes to its application, which may include providing certain undertakings in connection with its application, for example appointing different directors to the entity making the application or putting in place appropriate financial guarantees, William Hill and GVC would deem the condition not to have been met and would request that the Panel permit them to lapse the Offer on the grounds that this is material in the context of Rule 13.5(a) of the City Code.

If William Hill does not obtain the Australian Foreign Investment Review Board Approval, the Treasurer of Australia may make various orders including an order prohibiting or deferring the payment of any sums due to the company in respect of shares or assets held or an order directing the disposal of shares or assets held.

In these circumstances, William Hill and GVC would deem the condition not to have been met and would request that the Panel permit them to lapse the Offer on the grounds that this is material in the context of Rule 13.5(a) of the City Code.

The relevant applications to the NT Commission to obtain the requisite licence on terms satisfactory to William Hill will be made as soon as practicable.

The Scheme will be governed by English law and will be subject to the jurisdiction of the courts of England and Wales. The Scheme will be subject to the applicable requirements of the City Code, the Panel, the London Stock Exchange and the FSA.

William Hill Australia and GVC reserve the right, with the consent of the Panel, to elect to implement the Offer by way of a takeover offer as an alternative to the Scheme. In such event, the Offer will be implemented on substantially the same terms and conditions as those that would apply to the Scheme (subject to appropriate amendments, including (without limitation) an acceptance condition set at 90 per cent. of the shares to which such takeover offer relates and of the voting rights attached to such shares (but capable of waiver in accordance with Rule 10 of the City Code) in substitution for the conditions in paragraph 1 of Part A of Appendix I).

28.    General

The bases and sources of certain financial information contained in this announcement are set out in Appendix II. Certain terms used in this announcement are defined in Appendix IV.

29.    Documents on display

Copies of the following documents will be made available on Sportingbet's, William Hill's and GVC's websites at www.sportingbetplc.com, www.williamhillplc.com and www.GVC-plc.com respectively, from no later than 12.00 noon on the Business Day following  the date of this announcement until the Effective Date:

  • the irrevocable undertakings referred to at paragraph 4 above;
  • the confidentiality agreement referred to at paragraph 22 above;
  • the co-operation agreement referred to at paragraph 22 above;
  • the non-solicitation agreement referred to at paragraph 22 above;
  • the revolving credit facility referred to at paragraph 19 above;
  • the term loan facility referred to at paragraph 19 above; and
  • the undertakings constituting the cash underpinning arrangements referred to at paragraph  3 above.

Investor and Analyst Meeting:

William Hill will hold a meeting for analysts and investors on 20 December 2012 at 4.45 p.m. (UK time) to discuss the Offer. The meeting will take place at The Lincoln Centre, 18 Lincoln's Inn Fields, London WC2A 3ED. Interested parties can dial into this meeting using the following access details:

Inside the UK 0800 634 5205

Outside the UK +44 (0) 20 8817 9301

The participant passcode is 9624114

The meeting will also be available by webcast on William Hill's website for all interested parties. The webcast can be accessed via William Hill's website, www.williamhillplc.com. A replay facility will be available via William Hill's website and by dialling +44 (0) 20 7769 6425 quoting the replay access code 9589 073# until 3 January 2013.

 

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Enquiries

William Hill
Ralph Topping, Chief Executive
Neil Cooper, Group Finance Director
Lyndsay Wright, Director of IR
+44 (0)20 8918 3614
   
Citi (Lead Financial Adviser and Joint Broker to William Hill)
Jan Skarbek
Andrew Seaton
Sajjad Vakilian
+44 (0)20 7986 4000
   
Investec (Financial Adviser and Joint Broker to William Hill)
Chris Treneman
James Rudd
+44 (0)20 7597 5970
   
Brunswick (PR Adviser to William Hill)
Simon Sporborg
+44 (0)20 7404 5959
   
GVC
Kenneth Alexander, Chief Executive Officer
Richard Cooper, Group Finance Director
+44 (0)20 7398 7702
   
Daniel Stewart (Financial Adviser, NOMAD and Broker to GVC)
Paul Shackleton
David Hart
+44 (0)20 7776 6550
   
Abchurch (PR Adviser to GVC Holdings) +44 (0)20 7398 7702
Henry Harrison-Topham  
   
Sportingbet
Andrew McIver
Jim Wilkinson
+44 (0)20 7184 1800
   
Lazard (Financial Adviser to Sportingbet)
Cyrus Kapadia
Aamir Khan
+44 (0)20 7187 2000
 
   
Canaccord Genuity Limited (Broker to Sportingbet)
Erik Anderson
Bruce Garrow
+44 (0)20 7523 8350
   
Maitland (PR Adviser to Sportingbet)
George Hudson
Daniel Yea
+44 (0)20 7379 5151
+44 (0)75 9527 0877
+44 (0)75 9527 0691

 

Further information

Citigroup Global Markets Limited, who is authorised and regulated in the UK by the Financial Services Authority, is acting for William Hill and no-one else in connection with the Offer and will not regard any other person as a client in relation to the Offer and will not be responsible to anyone other than William Hill for providing the protections afforded to its clients or for providing advice in relation to the Offer or any matters referred to in this announcement.

Investec Investment Banking, a division of Investec Bank plc, who is authorised and regulated in the UK by the Financial Services Authority, is acting for William Hill and no-one else in connection with the Offer and will not regard any other person as a client in relation to the Offer and will not be responsible to anyone other than William Hill for providing the protections afforded to its clients or for providing advice in relation to the Offer or any matters referred to in this announcement.

Daniel Stewart & Company plc, who is authorised and regulated in the UK by the Financial Services Authority, is acting for GVC and no-one else in connection with the Offer and will not regard any other person as a client in relation to the Offer and will not be responsible to anyone other than GVC for providing the protections afforded to its clients or for providing advice in relation to the Offer or any matters referred to in this announcement.

Lazard & Co., Limited, who is authorised and regulated in the UK by the Financial Services Authority, is acting for Sportingbet and no-one else in connection with the Offer and will not regard any other person as a client in relation to the Offer and will not be responsible to anyone other than Sportingbet for providing the protections afforded to its clients or for providing advice in relation to the Offer or any matters referred to in this announcement.

Canaccord Genuity Limited, who is authorised and regulated in the UK by the Financial Services Authority, is acting for Sportingbet and no-one else in connection with the Offer and will not regard any other person as a client in relation to the Offer and will not be responsible to anyone other than Sportingbet for providing the protections afforded to its clients or for providing advice in relation to the Offer or any matters referred to in this announcement.

Sportingbet Shareholders and Sportingbet Convertible Bondholders may request a hard copy of this announcement by contacting Sportingbet's registrar, Capita Registrars on 0871 664 0321 (from inside the UK) or +44 20 8638 3399 (from outside the UK). Calls to the 0871 664 0321 number cost 10 pence per minute (including VAT) plus any of your service provider's network extras, lines are open 9.00 a.m. - 5.30 p.m (UK time) Monday to Friday. Calls to the Capita Registrars' +44 20 8638 3399 number from outside the UK are charged at applicable international rates. Different charges may apply to calls made from mobile telephones and calls may be recorded and monitored randomly for security and training purposes. Capita Registrars cannot provide advice on the merits of the Offer nor give any financial, legal or tax advice. It is important to note that unless such a request is made, a hard copy of this announcement will not be sent to any Sportingbet Shareholder or Sportingbet Convertible Bondholder. A Sportingbet Shareholder or Sportingbet Convertible Bondholder may also request that all future documents, announcements and information to be sent to that Sportingbet Shareholder or Sportingbet Convertible Bondholder in relation to the Offer should be in hard copy form.

This announcement is for information purposes only and does not constitute an offer to sell or an invitation to purchase or subscribe for any securities or the solicitation of an offer to buy any securities in any jurisdiction, pursuant to the Offer or otherwise, nor shall there be any sale, issue or transfer of  the securities referred to in this announcement in any jurisdiction in contravention of  applicable law. The Offer will be made solely by means of the Scheme Document or any other document by which the Offer is made which will contain the full terms and Conditions of the Offer, including details of  how to vote in respect of  the Scheme.

This announcement has been prepared for the purpose of complying with English law and the City Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside the United Kingdom.

Sportingbet will prepare the Scheme Document to be distributed to Sportingbet Shareholders and Sportingbet Convertible Bondholders. Sportingbet, William Hill and GVC urge Sportingbet Shareholders and Sportingbet Convertible Bondholders to read the Scheme Document and the GVC Prospectus when they become available because they will contain important information relating to the Offer. Any approval, decision or other response to the Offer should be made only on the basis of information in the Scheme Document and the GVC Prospectus.

The statements contained in this announcement are made as at the date of this announcement, unless some other time is specified in relation to them. Nothing contained in this announcement shall be deemed to be a forecast, projection or estimate of the future financial performance of Sportingbet or the Sportingbet Group, William Hill or the William Hill Group or GVC or the GVC Group except where otherwise stated.

Overseas Shareholders

The release, publication or distribution of this announcement in certain jurisdictions may be restricted by law. Persons who are not resident in the United Kingdom or who are subject to the laws of other jurisdictions should inform themselves of, and observe, any applicable requirements. Any failure to comply with the restrictions may constitute a violation of the securities laws of any such jurisdiction. The Offer relates to securities of an English company and is proposed to be effected by means of a scheme of arrangement under the laws of England and Wales. The Scheme will relate to the shares of an English company that is a "foreign private issuer" as defined under Rule 36.4 under the US Securities Exchange Act of 1934, as amended (the "Exchange Act"). A transaction effected by means of a scheme of arrangement is not subject to proxy solicitation or tender offer rules under the Exchange Act. Accordingly, the Scheme is subject to the disclosure requirements, rules and practices applicable in the United Kingdom to schemes of arrangement, which differ from the requirements of US proxy solicitation or tender offer rules and the laws of other jurisdictions outside the United Kingdom. Financial information included in the relevant documentation will have been prepared in accordance with accounting standards applicable in the United Kingdom that may not be comparable to the financial statements of  US companies. However, if  William Hill Australia and GVC were to elect to implement the Offer by means of  a takeover offer, such takeover offer will be made in compliance with all applicable laws and regulations, including US tender offer rules, to the extent applicable.

Unless otherwise determined by William Hill Australia and GVC or required by the City Code, and permitted by applicable law and regulation, the Offer will not be made available, directly or indirectly, in, into or from a Restricted Jurisdiction and no person may vote in favour of  the Offer by any use, means, instrumentality or form within a Restricted Jurisdiction or any other jurisdiction where to do so would violate the laws of such jurisdiction. Accordingly, copies of  this announcement and all documents relating to the Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in, into or from a Restricted Jurisdiction or any other jurisdiction where to do so would violate the laws of such jurisdiction, and persons receiving this announcement and all documents relating to the Offer (including custodians, nominees and trustees) must not mail or otherwise distribute or send them in, into or from such jurisdictions where to do so would violate the laws in that jurisdiction. The Offer (unless otherwise permitted by applicable law and regulation) will not be made, directly or indirectly, in or into, or by the use of the mails, or by any means or instrumentality (including without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of, any Restricted Jurisdiction, and the Offer will not be capable of acceptance from or within any Restricted Jurisdiction.

The availability of the Offer to Sportingbet Shareholders and Sportingbet Convertible Bondholders who are not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions in which they are resident. Persons who are not resident in the United Kingdom should inform themselves of, and observe, any applicable requirements.

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Forward-looking statements

This announcement contains statements which are, or may be deemed to be, "forward-looking statements" which are prospective in nature. All statements other than statements of historical fact may be forward-looking statements. They are based on current expectations and projections about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of forward-looking words such as "plans", "expects", "is expected", "is subject to", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", "believes", "targets", "aims", "projects" or words or terms of similar substance or the negative thereof, as well as variations of such words and phrases or statements that certain actions, events or results "may", "could", "should", "would", "might" or "will" be taken, occur or be achieved. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Forward-looking statements include statements relating to the following: (i) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and prospects; (ii) business and management strategies and the expansion and growth of William Hill's, GVC's or Sportingbet's operations and potential synergies resulting from the Offer; and (iii) the effects of government regulation on William Hill's, GVC's or Sportingbet's business.

Such forward looking statements involve risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results to differ materially from those projected or implied in any forward looking statements. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward looking statements, which speak only as of the date hereof. Each of William Hill, GVC and Sportingbet disclaims any obligation to update any forward looking or other statements contained herein, except as required by applicable law.

Except as expressly provided in this announcement, no forward looking or other statements have been reviewed by the auditors of William Hill, GVC or Sportingbet. All subsequent oral or written forward looking statements attributable to William Hill, GVC or Sportingbet or any of their respective members, directors, officers or employees or any person acting on their behalf are expressly qualified in their entirety by the cautionary statement above.

Disclosure requirements of the City Code

Under Rule 8.3(a) of the City Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th Business Day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th Business Day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the City Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the Business Day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3. William Hill, GVC and the Panel have agreed that for the purposes of this offer period GVC will be treated as a paper offeror for the purposes of Rule 8.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Information relating to Sportingbet Shareholders

Please be aware that addresses, electronic addresses and certain other information provided by Sportingbet Shareholders, persons with information rights and other relevant persons for the receipt of communications from Sportingbet may be provided to William Hill, William Hill Australia or GVC during the offer period as requested under Section 4 of Appendix 4 of the City Code to comply with Rule 2.12(c).

Publication on website

A copy of this announcement will be available free of charge, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, on William Hill's website at www.williamhillplc.com, on GVC's website at www.GVC-plc.com and on Sportingbet's website at www.sportingbetplc.com by no later than noon (London time) on the day following this announcement. For the avoidance of doubt, the contents of those websites are not incorporated into and do not form part of this announcement.

 

APPENDIX I

CONDITIONS TO AND FURTHER TERMS OF THE OFFER

Part A: Conditions of the Offer

The Offer will be conditional upon the Scheme becoming unconditional and being effective, subject to the City Code, by no later than the Long Stop Date or such later date (if any) as Sportingbet, William Hill Australia and GVC may agree and the Panel and (if required) the Court may allow.

1.    The Scheme will be subject to the following conditions:

(a) its approval by a majority in number representing not less than 75 per cent in value of the Scheme Shareholders who are on the register of members of Sportingbet at the Voting Record Time, and who are present and vote, whether in person or by proxy, at the Shareholder Court Meeting (and at any separate class meeting which may be required by the Court or any adjournment thereof);

(b) the Sportingbet Shareholder Resolution being duly passed by the requisite majority at the Sportingbet General Meeting (or any adjournment thereof);

(c) its approval by a majority in number representing not less than 75 per cent in value of the Sportingbet Convertible Bondholders at the Voting Record Time, and who are present and vote, whether in person or by proxy, at the Sportingbet Convertible Bond Court Meeting (and at any separate class meeting which may be required by the Court or any adjournment thereof);

(d) the sanction of the Scheme by the Court (with or without modification but subject to any modification being on terms reasonably acceptable to Sportingbet, William Hill Australia and GVC) and confirmation of the Reduction of Capital by the Court and (i) the delivery of copies of the Court Orders and the requisite statement of capital attached thereto to the Registrar of Companies and (ii) if so ordered by the Court in order to take effect, the registration of the Reduction Court Order and such statement of capital by the Registrar of Companies.

2.        The Scheme shall lapse unless:

(a) the Scheme and the Reduction of Capital have both become effective on or before 6 p.m. on the Long Stop Date; and

(b) approvals (i) of the Scheme Shareholders at the Shareholder Court Meeting and Sportingbet Shareholders at the Sportingbet General Meeting and (ii) of the Sportingbet Convertible Bondholders at the Sportingbet Convertible Bond Court Meeting have been obtained before 10 May 2013 (or such later date (if any) as Sportingbet, William Hill Australia and GVC may agree, and the Panel and the Court (if required) may allow).

3.        In addition, subject as stated in Part B below and to the requirements of the Panel in accordance with the City Code, William Hill Australia, GVC and Sportingbet have agreed that the Offer will be conditional upon the following Conditions and, accordingly, the necessary actions to make the Scheme (as amended if appropriate) effective will not be taken unless such Conditions (as amended if appropriate) have been satisfied or, where relevant, waived:

(a) the passing by the requisite majority at the GVC General Meeting (or any adjournment thereof) of the GVC Shareholder Resolution;

(b) the London Stock Exchange agreeing to admit or re-admit (as applicable) the GVC Shares in issue upon the Scheme becoming effective (including the New GVC Shares) to trading on AIM subject only to the Scheme becoming effective in accordance with its terms and/or, in the case of the New GVC Shares, to the allotment of such shares;

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(c) the occurrence of any of the following events:

(i) William Hill Australia receives written notice issued by or on behalf of the Treasurer of Australia that there is no objection under the FATA or Australian foreign investment policy to the Proposed Australian Acquisition (that notice to be subject to no conditions or only to those conditions that William Hill Australia considers acting reasonably to be acceptable);

(ii) the expiry of the relevant period following the giving of notice relating to the Proposed Australian Acquisition under section 26 of the FATA without any interim or permanent order of prohibition being made under the FATA; or

(iii) the Treasurer of Australia becoming precluded from exercising any power to make an order under the FATA in relation to the Proposed Australian Acquisition;

(d) the NT Commission granting, in a form satisfactory to William Hill, acting reasonably, approval for a change of control of each of the relevant Sportingbet subsidiary undertakings that hold the NT Licences in accordance with the provisions of the NT Licences and the NT Act;

(e) the expiry of the relevant period following the giving of notice related to the Proposed Australian Acquisition under section 26 of the FATA without the Australian Competition and Consumer Commission objecting to the Proposed Australian Acquisition;

(f) all applicable waiting and other time periods (including any extension(s) thereof) during which any Regulatory Authority, other than any Australian Regulatory Authority, in respect of the Offer or the acquisition or proposed acquisition of any shares in, or control of Sportingbet or any member of the Wider Sportingbet Group by any member of the Wider William Hill Group and/or Wider GVC Group could intervene having expired, lapsed or terminated;

(g) save as Disclosed, there being no provision of any agreement, arrangement, licence, permit, lease or other instrument to which any member of the Wider Sportingbet Group is a party or by or to which any such member or any of its assets may be bound, entitled or subject, or any circumstance which, in each case as a consequence of the Offer or the proposed acquisition of any shares, assets or other securities in the Wider Sportingbet Group by any member of the Wider William Hill Group and/or Wider GVC Group or because of a change in the control or management of the Wider Sportingbet Group (to an extent which is or would be material in the context of the Wider Sportingbet Group taken as a whole), could or might reasonably be expected to result in:

(i) any monies borrowed by or any other indebtedness (actual or contingent) of, or grant available to, any such member, being or becoming repayable or capable of being declared repayable immediately or earlier than the repayment date stated in such agreement or the ability of any such member to borrow monies or incur any indebtedness being withdrawn or inhibited or being capable of becoming or being withdrawn or inhibited;

(ii) any such agreement, arrangement, licence, permit, lease or other instrument or the interests of any such member or the rights, liabilities or obligations of any such member thereunder being, or becoming capable of being, terminated or adversely modified or affected or any obligation or liability arising or any adverse action being taken or arising thereunder;

(iii) any assets owned or used by any such member or any interest in such asset being or falling to be disposed of or charged or ceasing to be available to any such member or any right arising under which any such asset or interest could be required to be disposed of or charged or could cease to be available to any such member;

(iv) the creation or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property or assets of any such member or any such mortgage, charge or other security interest (whenever arising or having arisen) being enforced or becoming enforceable;

(v) the rights, liabilities, obligations or interests of any such member under any such agreement, arrangement, licence, permit, lease or other instrument, or the interest or business of any such member with, any other person, firm, company or body (or any agreement(s) or arrangement(s) relating to any such interest or business) being terminated, adversely modified or adversely affected;

(vi) the business, assets, liabilities, profits, financial or trading position, prospects or value of any such member being adversely affected;

(vii) any such member ceasing to be able to carry on business under any name or in any jurisdiction under which it presently does so;

(viii) the creation of any liability, actual or contingent, by or in respect of any such member, other than in the ordinary course of business; or

(ix) any requirement on any such member to acquire, subscribe, pay up or repay any shares or other securities (other than contemplated by the terms of the Scheme),

and no event having occurred which, under any provision of any agreement, arrangement, licence, permit, lease or other instrument to which any member of the Wider Sportingbet Group is a party or by or to which any such member or any of its assets may be bound, entitled or subject, would result or would be likely to result in any of the events or circumstances as are referred to in sub paragraphs (i) to (ix) above in each case to an extent which is material in the context of the Wider Sportingbet Group taken as a whole;

(h) no Regulatory Authority having announced, or given notice in writing of a decision to take, institute, implement or threaten any action, proceeding, suit, investigation, enquiry or reference (and in each case, not having withdrawn the same), or having required any action to be taken or having enacted, made or proposed any statute, regulation, decision or order (and in each case, not having withdrawn the same), and there not continuing to be outstanding any statute, regulation, decision or order, which would or would reasonably be expected to:

(i) require, prevent or materially delay the divestiture, or alter the terms envisaged for any proposed divestiture by any member of the Wider Sportingbet Group, Wider William Hill Group or Wider GVC Group of all or any part of their respective businesses, assets, liabilities or property or of any Sportingbet Shares or other securities in Sportingbet or any member of the Wider Sportingbet Group, the Wider William Hill Group or Wider GVC Group or impose any material limitation on the ability of any of them to conduct their respective businesses (or any of them) or to hold or exercise any right of ownership in respect of, or to exercise any management control over, any of their respective assets, properties or businesses or any part thereof (to an extent which is or would be material in the context of the Wider Sportingbet Group taken as a whole);

(ii) impose any limitation on or result in a delay in the ability of, or render unable, William Hill Australia or GVC or any member of the Wider William Hill Group or Wider GVC Group directly or indirectly to acquire some or all of the Sportingbet Shares, other securities or assets in the Wider Sportingbet Group and/or the Sportingbet Convertible Bonds (to an extent which is or would be material in the context of the Wider Sportingbet Group taken as a whole);

(iii) impose any limitation on the ability of any member of the Wider William Hill Group or Wider GVC Group or any member of the Wider Sportingbet Group to conduct any of their respective businesses, or to integrate or co-ordinate such businesses or any part thereof with any other business of any other member of the Wider William Hill Group or Wider GVC Group or Wider Sportingbet Group in a manner which is material in the context of the Wider William Hill Group or Wider GVC Group or Wider Sportingbet Group, as the case may be, taken as a whole, or to hold or exercise, directly or indirectly, any right of ownership in respect of shares or other securities (or the equivalent) in, or to exercise effectively management rights or control over, any of the businesses or assets or any part thereof of any member of the Wider Sportingbet Group or the Wider William Hill Group or Wider GVC Group in a manner which is material in the context of the Wider William Hill Group or Wider GVC Group or Wider Sportingbet Group, as the case may be, taken as a whole;

(iv) otherwise materially adversely affect any or all of the business, assets, liabilities, profits, financial or trading position, prospects or value of any member of the Wider Sportingbet Group to an extent which is material in the context of the Wider Sportingbet Group taken as a whole;

(v) make the Offer, its implementation or the acquisition or proposed acquisition by William Hill Australia or GVC or any member of the Wider William Hill Group and/or Wider GVC Group of any shares, assets or other securities in, or control or management of, Sportingbet and/or the Wider Sportingbet Group void, illegal and/or unenforceable under the laws of any relevant jurisdiction, or otherwise, directly or indirectly, restrain, prevent, restrict, prohibit, or delay the same, or impose additional material adverse conditions or obligations with respect to, or otherwise impede, challenge, interfere or require material adverse amendment of the Offer or the acquisition by William Hill Australia and/or GVC or any member of the Wider William Hill Group and/or Wider GVC Group of any shares, assets or other securities in Sportingbet and/or the Wider Sportingbet Group (to an extent which is or would be material in the context of the Wider Sportingbet Group taken as a whole);

(vi) except if William Hill and GVC elect to implement the Offer by way of a takeover offer, in respect of the "squeeze out" procedure in accordance with the provisions of Chapter 3 of Part 28 of the Act, require any member of the Wider William Hill Group or Wider GVC Group or the Wider Sportingbet Group to acquire, or to offer to acquire, any shares, assets or other securities (or the equivalent) or interest in any member of the Wider Sportingbet Group or the Wider William Hill Group or Wider GVC Group owned by any third party (other than in the implementation of the Offer) (to an extent which is or would be material in the context of the Wider Sportingbet Group taken as a whole); or

(vii) result in any member of the Wider Sportingbet Group or the Wider William Hill Group or Wider GVC Group ceasing to be able to carry on all or any part of its business under any name or in any jurisdiction under or in which it presently does so to an extent which is material in the context of the Wider Sportingbet Group or the Wider William Hill Group or Wider GVC Group, as the case may be, taken as a whole;

(viii) result in the refusal, withholding, suspension, withdrawal, cancellation, termination or modification in whole or in part of any licence, authority, permission or privilege held by or enjoyed by any member of the Wider William Hill Group or Wider GVC Group which is necessary for the carrying on of its business or the imposition of any conditions, restrictions or limitations upon such licence, authority, permission or privilege which materially inhibits the exercise thereof, in each case to an extent which is material in the context of the Wider William Hill Group or Wider GVC Group, as the case may be, taken as a whole,

and all applicable waiting and other time periods (including any extension(s) thereof) during which any such Regulatory Authority could institute, implement or threaten any action, proceeding, suit, investigation, enquiry or reference or any other step under the laws of any applicable jurisdiction in respect of the Offer or proposed acquisition of any shares, assets or securities in Sportingbet and/or the Wider Sportingbet Group having expired, lapsed or been terminated;

(i) other than as specified in sub-clauses (c), (d) and (e) above, all material filings or applications which are necessary having been made and all appropriate waiting periods (including extension(s) thereof) under applicable legislation or regulation of any jurisdiction having expired, lapsed or terminated (as appropriate) and all statutory or regulatory obligations in any jurisdiction having been complied with in connection with the Offer or the acquisition by any member of the Wider William Hill Group or Wider GVC Group of any shares, assets or other securities in, or control of, Sportingbet and/or the Wider Sportingbet Group and all Approvals necessary in any relevant jurisdiction for or in respect of the Offer or the proposed acquisition of any shares, assets or other securities in, or control of, Sportingbet and/or the Wider Sportingbet Group by any member of the Wider William Hill Group or Wider GVC Group having been obtained on terms and in a form reasonably satisfactory to William Hill Australia and GVC from all appropriate Regulatory Authorities and, without prejudice to the generality of the foregoing, from any persons or bodies with whom any member of the Wider Sportingbet Group has entered into contractual arrangements, and all such Approvals together with all Approvals necessary for the carrying on of the business of any member of the Wider Sportingbet Group as currently carried on remaining in full force and effect (where the absence of such Approvals would be material and adverse in the context of the Offer) and there being no notice or intimation of any intention to revoke, suspend, not to renew, or materially restrict or amend any of the same where, in each case, the absence of such Approval would have a material adverse effect on the Wider Sportingbet Group taken as a whole;

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(j) except as Disclosed, no member of the Wider Sportingbet Group having, since 31 July 2012:

(i) save as between members of the Wider Sportingbet Group, or upon the exercise of options granted in the ordinary course under the Sportingbet Share Plans or on conversion of the Sportingbet Convertible Bonds, issued or agreed to issue or authorised the issue or proposed the issue of additional shares of any class or of Sportingbet Convertible Bonds, or securities convertible into, or rights, warrants or options to subscribe for or acquire any such shares or convertible securities;

(ii) save as between members of the Wider Sportingbet Group or pursuant to the implementation of the Offer, purchased, redeemed or repaid or announced any proposal to purchase, redeem or repay any of its own shares (including treasury shares) or other securities or reduced or, save in respect to the matters mentioned in sub-paragraph (i) above, made or authorised any other change to any part of its share capital;

(iii) save as between members of the Wider Sportingbet Group and save for the recommendation, declaration and payment of the Final Dividend, recommended, declared, paid or made or proposed to recommend, declare, pay or make any bonus, dividend or other distribution, whether payable in cash or otherwise;

(iv) save as between members of the Wider Sportingbet Group or pursuant to the Offer, merged with or demerged from any body corporate, partnership or business or (other than in the ordinary course of business) acquired or disposed of or transferred, mortgaged, charged or created any security interest over, any business or asset or any right, title or interest in any material business or asset (including shares and trade investments) or authorised, proposed or announced any intention to propose the same;

(v) save as between members of the Wider Sportingbet Group or pursuant to the Offer, made or authorised or proposed or announced an intention to propose any change in its share or loan capital;

(vi) save as between members of the Wider Sportingbet Group, issued, authorised or proposed the issue of any debentures or made any changes in or to any debentures or, save in the ordinary course of its business, incurred or increased any indebtedness or liability (actual or contingent) or proposed to do any of the foregoing which is material in the context of the Wider Sportingbet Group taken as a whole;

(vii) entered into, implemented, effected, authorised, proposed or announced any merger, demerger, reconstruction, amalgamation, scheme, commitment or other equivalent transaction or arrangement in respect of itself or another member of the Wider Sportingbet Group other than the Offer or between members of the Wider Sportingbet Group or as contemplated by the Transfer Agreement;

(viii) other than in connection with the Offer, entered into, or varied the terms of, or made any offer (which remains open for acceptance) to enter into or vary the terms of, any agreement, arrangement, instrument, commitment or obligation with or for the benefit of any of the directors or senior executives or any connected person or any such person (within the meaning of the Companies Act) of any member of the Wider Sportingbet Group; including any retirement, death or disability benefit or any share option or bonus scheme;

(ix) entered into, or varied, or authorised, proposed or announced its intention to enter into or vary any contract, agreement, transaction, arrangement, commitment or obligation (whether in respect of capital expenditure or otherwise) which:

(A) is of a long term, onerous or unusual nature or magnitude; or

(B) materially restricts or might materially restrict the business of any member of the Wider Sportingbet Group; or

(C) is outside of the ordinary course of business,

and which is, in any such case, material in the context of the Wider Sportingbet Group taken as a whole;

(x) terminated or varied the terms of any agreement or arrangement between any member of the Wider Sportingbet Group and any other person in a manner which would or might have a material adverse effect on the financial position or prospects of the Wider Sportingbet Group taken as a whole;

(xi) (other than in respect of a member which is dormant and was solvent at the relevant time) taken any corporate action or had any legal proceedings started or threatened in writing against it or had any order made for its winding-up, dissolution or reorganisation or for the appointment of a receiver, administrative receiver, administrator, trustee or similar officer of all or any part of its assets or revenues or any analogous proceedings in any jurisdiction or had any such person appointed which in any case is material in the context of the Wider Sportingbet Group taken as a whole;

(xii) been unable, or admitted that it is unable, to pay its debts or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or ceased or threatened to cease carrying on all or a material part of its business;

(xiii) waived or compromised any claim that is material in the context of the business of the Wider Sportingbet Group taken as a whole;

(xiv) made any alteration to its articles of association (other than an alteration in connection with the Scheme);

(xv) entered into or varied any contract, commitment, transaction arrangement or agreement or passed any resolution or made any offer (which remains open for acceptance) with respect to or announced any intention to, or proposed to, effect any of the transactions, matters or events referred to in this condition (j);

(xvi) made or agreed or consented to any material change to:

(A) the terms of the trust deeds constituting the pension scheme(s) established by any member of the Wider Sportingbet Group for its directors, employees or their dependents;

(B) the contributions payable to any benefits which accrue or to the pensions that are payable thereunder;

(C) the basis on which qualification for, or accrual or entitlement to, such benefits or pensions are calculated or determined; or

(D) the basis upon which liabilities (including pensions) of such pension scheme(s) are funded, valued or made,

in any case in a manner that is material to the Wider Sportingbet Group taken as a whole; or

(xvii)     other than in connection with the Offer, proposed, agreed to provide or modified the terms of any share option scheme, incentive scheme or other benefit relating to the employment or termination of employment of any person employed by the Wider Sportingbet Group in a manner which is material in the context of the Wider Sportingbet Group taken as a whole;

(k) except as Disclosed, since 31 July 2012:

(i) no adverse change or deterioration having occurred in the business, assets, financial or trading position or profits of any member of the Wider Sportingbet Group which in any such case is material to the Wider Sportingbet Group taken as a whole;

(ii) no litigation, arbitration proceedings, prosecution or other legal proceedings to which any member of the Wider Sportingbet Group is or may become a party (whether as a claimant, defendant or otherwise) and no enquiry or investigation by or complaint or reference to any Regulatory Authority against or in respect of any member of the Wider Sportingbet Group having been implemented, instituted, announced or threatened in writing by or against or remaining outstanding against or in respect of any member of the Wider Sportingbet Group which in any such case would or might reasonably be expected to be material in the context of the Wider Sportingbet Group taken as a whole;

(iii) no contingent or other liability having arisen, become apparent to William Hill Australia and GVC or been increased, which would or might be likely to materially and adversely affect any member of the Wider Sportingbet Group to an extent which is material in the context of the Wider Sportingbet Group taken as a whole; and

(iv) no steps having been taken which are reasonably likely to result in the withdrawal (without replacement), cancellation, termination or modification of any material licence held by any member of the Wider Sportingbet Group which is necessary for the proper carrying on of its business and which is material in the context of the Wider Sportingbet Group taken as a whole;

(l) except as Disclosed, William Hill Australia and GVC not having discovered:

(i) that any financial, business or other information concerning Sportingbet or the Wider Sportingbet Group as contained in the information disclosed at any time by or on behalf of any member of the Wider Sportingbet Group whether publicly, to any member of the Wider William Hill Group or Wider GVC Group or otherwise is materially misleading, contains a material misrepresentation of fact or omits to state a fact necessary to make the information therein accurate or not misleading, in each case to an extent which is material in respect of the Wider Sportingbet Group taken as a whole;

(ii) that any member of the Wider Sportingbet Group is subject to any liability (contingent or otherwise) which is material in the context of the Wider Sportingbet Group taken as a whole; or

(iii) that any information which affects the import of any information disclosed to William Hill Australia or GVC at any time by or on behalf of any member of the Wider Sportingbet Group and which is material and adverse in the context of the Wider Sportingbet Group taken as a whole; or

(iv) that any past or present member of the Wider Sportingbet Group has failed to comply in any material respect with any and/or all applicable legislation or regulation or any agreement or arrangement concerning any relevant jurisdiction with regard to the use, storage, treatment, transport, handling, disposal, spillage, release, discharge, leak or emission of any waste or hazardous substances, or of any substance likely to impair the environment or harm human health or animal health, or otherwise relating to environmental matters or the health and safety of any person, or that there has otherwise been any such use, storage, treatment, transport, handling, disposal, spillage, release, discharge, leak or emission (whether or not the same constituted a non-compliance by any person with any such legislation, regulation, agreement or arrangement, and wherever the same may have taken place) which, in each case, would be reasonably likely to give rise to any material liability (actual or contingent) on the part of any member of the Wider Sportingbet Group and which, in any case, is material in the context of the Wider Sportingbet Group taken as a whole; or

(v) that there is, or is likely to be, any material liability (actual or contingent) of any past or present member of the Wider Sportingbet Group to make good, repair, reinstate or clean up any property or any controlled waters now or previously owned, occupied, operated or made use of or controlled by any such past or present member of the Wider Sportingbet Group, under any environmental legislation, regulation, decision, notice, circular or order of any Regulatory Authority or otherwise in any jurisdiction which, in any case, is material in the context of the Wider Sportingbet Group taken as a whole.

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Part B: Certain further terms of the Offer

4.    Subject to the requirements of the Panel or, if required, the Court, William Hill Australia and GVC reserve the right to waive:

(a) any of the deadlines set out in the condition in paragraph 1 of Part A above for the timing of the Shareholder Court Meeting, the Sportingbet Convertible Bond Court Meeting, the Sportingbet General Meeting and the Court Hearings;

(b) the condition in paragraph 1(c) of Part A above in respect of the Sportingbet Convertible Bondholder approval; and

(c) in whole or in part, all or any of the conditions set out in paragraphs 2 and 3 (with the exception of 3(a), 3(b) and 3(d)) of Part A above.

5.    William Hill Australia and/or GVC shall be under no obligation to waive (if capable of waiver) or treat as satisfied any condition of the Offer by a date earlier than the latest date for the fulfilment of that condition, notwithstanding that the other conditions of the Offer may at such earlier date have been waived or fulfilled and that there are at such earlier date no circumstances indicating that any of such conditions may not be capable of fulfilment.

6.    The Offer will lapse and the Scheme will not proceed if the OFT refers the Offer or any part of it to the Competiton Commission before the date of the Shareholder Court Meeting. In such event, none of Sportingbet, William Hill, William Hill Australia, GVC, Sportingbet Shareholders or Sportingbet Convertible Bondholders will be bound by the Scheme

7.    The Offer will be governed by English law and be subject to the exclusive jurisdiction of the English courts, to the conditions set out in Part A above and the further terms set out in this Part B, and to the terms and conditions set out in the Scheme Document and the Form of Election which will accompany that document. The Scheme will comply with the applicable requirements of the City Code, the Panel, the London Stock Exchange, the FSA and applicable securities laws.

8.    The availability of the Offer to persons not resident in the UK may be affected by the laws of their relevant jurisdiction. Any persons who are subject to the laws of any jurisdiction other than the UK should inform themselves about and observe any applicable legal or regulatory requirements of their jurisdiction. Further details in relation to Restricted Overseas Shareholders will be contained in the Scheme Document.

9.    Fractions of New GVC Shares will not be allotted or issued to Scheme Shareholders. All fractions of New GVC Shares to which Scheme Shareholders would otherwise have been entitled will be aggregated and sold in the market as soon as reasonably practicable after the Effective Date and the net proceeds of such sale (after deduction of broking fees and other sale costs and expenses) will be paid in cash in sterling to relevant Scheme Shareholders pro rata to their entitlements (except that amounts of £5 or less will be retained for the benefit of GVC).

10.    Subject to the consent of the Panel (if applicable), William Hill Australia and GVC reserve the right to elect to implement the Offer by way of a takeover offer as an alternative to the Scheme. In such event the Offer will be implemented on substantially the same terms and conditions (subject to appropriate amendments, including (without limitation) an acceptance condition set at 90 per cent. of the shares to which such takeover offer relates and of the voting rights attached to such shares (but capable of waiver in accordance with Rule 10 of the City Code) in substitution for the conditions in paragraph 1 of Part A above and subject to the availability of an exemption (if required) from the registration requirements of the US Securities Act and such amendments (if any) as William Hill Australia and GVC deem necessary in connection with US securities laws), so far as applicable, as those which would apply to the implementation of the Offer by means of the Scheme.

11.      The New GVC Shares have not been and will not be registered under the US Securities Act nor under the relevant securities laws of any Restricted Jurisdiction. The New GVC Shares may not be offered, sold or delivered, directly or indirectly, in the United States or any Restricted Jurisdiction nor to any United States person, except pursuant to exemptions from applicable requirements of the United States or any such jurisdiction.

12.      The New GVC Shares will be issued in registered form, will be capable of being held in both certificated and uncertificated form, will be issued credited as fully paid and will rank pari passu in all respects with the existing GVC Shares in issue on the Effective Date, including as to the right to receive and retain all dividends and other distributions declared, paid or made after the Effective Date. The New GVC Shares will be denominated in Euros. Application will be made for the admission or re-admission (as applicable) to trading on AIM of GVC Shares in issue upon the Scheme becoming effective (including the New GVC Shares).

 

APPENDIX II

SOURCES OF INFORMATION AND BASES OF CALCULATION

Unless otherwise stated, the following constitute the bases and sources of information referred to in this Announcement:

1. Financial information relating to Sportingbet has been extracted or derived (without adjustment) from the audited consolidated financial statements and unaudited management accounts for the Sportingbet Group for the financial year ended 31 July 2012 and the unaudited first quarter results of Sportingbet for the three months ended 31 October 2012.

2. Financial information relating to William Hill has been extracted or derived (without adjustment) from the audited consolidated financial statements for William Hill for the financial year ended 31 December 2011.

3. Financial information relating to GVC has been extracted or derived (without adjustment) from the audited consolidated financial statements for GVC for the financial year ended 31 December 2011.

4. The value placed by the Offer on the fully diluted share capital of Sportingbet (being 882,018,070 Sportingbet Shares) is based on:

  • 667,095,640 Sportingbet Shares in issue on 19 December 2012, being the last dealing day prior to the date of this announcement;
  • the maximum of 21,732,380 Sportingbet Shares which may be issued on or after the date of this announcement on the exercise or vesting of in-the-money options or LTIP awards under the Sportingbet Share Plans; and
  • 193,190,050 Sportingbet Shares which may be issued on or after the date of this announcement on the exercise of conversion rights in accordance with the terms and conditions of the Sportingbet Convertible Bonds (and taking account of the Change of Control Conversion Price). Further, this number of Sportingbet Shares is calculated by reference to an Effective Date of 31 March 2013 and consistent with prior practice on the conversion price calculation.

5. Unless otherwise stated, all Closing Prices for Sportingbet and GVC Shares are closing middle market quotations derived from the London Stock Exchange Daily Official List.

6. The number of GVC shares in issue on 19 December 2012, the last dealing day before this announcement, was 31,592,172.

7. The premium calculations per Sportingbet Share have been calculated by reference to closing middle market quotations derived from the London Stock Exchange Daily Official List.

8. All share prices expressed in pence have been rounded to the nearest penny and all percentages have been rounded to one decimal place.

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APPENDIX III

IRREVOCABLE UNDERTAKINGS/CASH UNDERPINNING ARRANGEMENTS

Part A: Irrevocable undertakings in respect of Sportingbet Shares

1 The following Sportingbet Directors have given irrevocable undertakings to vote in favour of the Scheme at the Shareholder Court Meeting and in favour of the Sportingbet Shareholder Resolution at the Sportingbet General Meeting:

Name Number of Sportingbet Shares Percentage of issued share capital of Sportingbet
Peter Dicks 699,622 0.1
Andy McIver 3,070,100 0.5
Jim Wilkinson 1,246,259 0.2
Brian Harris 476,775 0.1

2 Each of these undertakings will lapse if the Scheme or any resolution of the Sportingbet Shareholders upon the passing of which the implementation of the Scheme is dependent is not approved by the requisite majority of the Sportingbet Shareholders at the relevant shareholder or court meeting (or, if any such meeting is adjourned, at the relevant adjournment).

3 In addition, the following Sportingbet Shareholders have given irrevocable undertakings to vote in favour of the Scheme at the Shareholder Court Meeting and in favour of the Sportingbet Shareholder Resolution at the Sportingbet General Meeting and also to elect under the Mix and Match Facility to take the entirety of their consideration under the Offer in the form of New GVC Shares:

Name Number of Sportingbet Shares Percentage of issued share capital of Sportingbet
DBS Advisors Ltd. 35,857,703 5.38
Mark Blandford 122,859 0.02
Blandford Family Settlement 2008 8,480,173 1.27
Blandford Discretionary Settlement 2008 4,000,000 0.60
Rockridge Investments S.A. 15,000,000 2.25

4 Each of these undertakings (other than in respect of the making of elections for New GVC Shares under the Mix and Match Facility) may, at the option of the person giving such undertaking, cease to have effect if, prior to the fifth day after the posting of the Scheme Document, there is announced in accordance with the requirements of Rule 2.7 of the City Code an offer (whether to be implemented by way of a contractual offer or by way of a scheme of arrangement) for the entire issued share capital of Sportingbet (other than any shares held by the relevant offeror or its associates), which is not expressed to be subject to any pre-condition and under which the consideration payable represents in the reasonable opinion of Sportingbet's financial adviser an improvement of not less than 10 per cent. over the value of the consideration available under the Offer ("Alternative Offer"), unless William Hill Australia and GVC have, within five Business Days of such Alternative Offer being made, announced an improvement of the terms of the Offer such that the terms of the Offer as so improved are in the reasonable opinion of Sportingbet's financial adviser at least as favourable as the terms of such Alternative Offer.

5 Such undertakings will also lapse, in their entirety, if the offer lapses or is withdrawn  or if the Scheme or any resolution of the Sportingbet Shareholders upon the passing of which the implementation of the Scheme is dependent is not approved by the requisite majority of the Sportingbet Shareholders at the relevant shareholder or court meeting (or, if any such meeting is adjourned, at the relevant adjournment).

6 Henderson Global Investors, through the Volantis Capital team and in its capacity as discretionary investment manager, has given an irrevocable undertaking to consent to the Scheme and has also undertaken to be bound by it, to vote in respect of 10,102,999 Sportingbet Shares in favour of the Sportingbet Shareholder Resolution at the Sportingbet General Meeting and, in respect of such shares, to elect under the Mix and Match Facility to take the entirety of its consideration under the Offer in the form of New GVC Shares. The obligations under this undertaking are only binding on Henderson Global Investors to the extent that they relate to the investment management team operating under the Volantis Capital name and led by Adam McConkey, or his successor, together with any other employees in Henderson Group plc and its subsidiary undertakings from time to time who may be behind the same information barrier as that team. This undertaking (other than in respect of making an election for New GVC Shares under the Mix and Match Facility) may, at the option of Henderson Global Investors, cease to have effect in the same circumstances as those described in paragraph 4 above (other than the fact that where reference is made in paragraph 4 above to an Alternative Offer being announced prior to the fifth day after the posting of the Scheme Document, the corresponding reference in the undertaking given by Henderson Global Investors is to an Alternative Offer being announced prior to the tenth day after such posting) and will lapse in its entirety in the same circumstances as those described in 5 above.

7 Also, UBS has given an irrevocable undertaking in respect of 29,472,443 Sportingbet Shares to procure that the registered holder of such shares will vote in favour of the Scheme at the Shareholder Court Meeting and in favour of the Sportingbet Shareholder Resolution at the Sportingbet General Meeting. This undertaking ceases to have effect in the event of any amendment by relevant clients of UBS's authority or in the event of the making of any offer for the issued shares of Sportingbet for consideration which has a value equal to or greater than 59 pence per Sportingbet Share. Also, in the event of any transfer of any of such Sportingbet Shares to any replacement fund manager/ custodian nominated by UBS's underlying client/ customer in circumstances where such underlying client/ customer has terminated UBS's professional relationship in respect of such Sportingbet Shares, or in the event of any transfer of such Sportingbet Shares to meet any underlying customer or client redemption request, the undertaking will lapse in respect of the Sportingbet Shares transferred. UBS has also stated, on a non-binding basis, that, subject to any client restrictions, it intends to make no election under the Mix and Match Facility.

8 Bonaire Investment Holdings Ltd ("Bonaire") has given an irrevocable undertaking in respect of 45,045,275 Sportingbet Shares to vote in favour of the Scheme at the Shareholder Court Meeting and in favour of the Sportingbet Shareholder Resolution at the Sportingbet General Meeting and to elect under the Mix and Match Facility to take a minimum of 1,100,000 New GVC Shares as its consideration under the Offer. This undertaking (other than in respect of taking a minimum of 1,100,000 New GVC Shares by way of consideration) may at the option of Bonaire, cease to have effect if there is announced in accordance with the requirements of Rule 2.7 of the City Code an offer (whether to be implemented by way of a contractual offer or by way of a scheme of arrangement) for the entire issued share capital of Sportingbet (other than any shares held by the relevant offeror or its associates), which is not expressed to be subject to any pre-condition and under which the consideration payable represents in the reasonable opinion of Sportingbet's financial adviser an improvement on the value of the consideration available under the Offer ("Higher Offer"), unless William Hill Australia and GVC have, within four Business Days of such Higher Offer being made, announced an improvement of the terms of the Offer such that the terms of the Offer as so improved are in the reasonable opinion of Sportingbet's financial adviser at least as favourable as under the Higher Offer. Such undertaking will lapse, in its entirety, if the Offer is withdrawn or lapses or if the Scheme or any resolution of the Sportingbet Shareholders upon the passing of which the implementation of the Scheme is dependent is not approved by the requisite majority of the Sportingbet Shareholders at the relevant shareholder or court meeting (or, if any such meeting is adjourned, at the relevant adjournment) or if the Offer is revised in any way such that in the reasonable opinion of Sportingbet's financial adviser its terms are less favourable or if any of the irrevocable undertakings received from DBS Advisors Ltd., Mark Blandford (and certain related trusts), Rockridge Investments S.A. and Henderson Global Investors ceases to have effect. Such undertaking will in any event cease to have effect on 31 May 2013.

Part B: Irrevocable undertakings in respect of voting in favour of the GVC Shareholder Resolution

1 The following GVC Directors have given irrevocable undertakings to vote in favour of the GVC Shareholder Resolution

Name Number of GVC Shares Percentage of issued share capital of GVC
Lee Feldman 73,700 0.23
Kenny Alexander 313,333 0.99
Richard Cooper 135,000 0.43

2 Each of these undertakings will lapse at midnight on 28 February 2013.

3 In addition, the following GVC Shareholders have given irrevocable undertakings to vote in favour of the GVC Shareholder Resolution:

Name Number of GVC Shares Percentage of issued share capital of GVC
Audley Capital Management Limited 6,755,031 21.38
Ora Capital 5,975,610 18.91
Henderson Global Investors 3,125,320 9.89

4 Each of these undertakings will lapse on 28 February 2013 or at any earlier date upon which the GVC Directors withdraw or adversely amend their recommendation to GVC Shareholders to vote in favour of the GVC Shareholder Resolution.

Part C: Cash underpinning commitments

Each of the following parties has entered into a commitment to provide cash to GVC (at the rate of 233.5 pence for each relevant New GVC Share) for payment to Sportingbet Shareholders in respect of some of the elections for cash which may be made under the Mix and Match Facility, on terms that the New GVC Shares to which those Sportingbet Shareholders would be otherwise entitled, but for making such elections, are allotted instead to such parties:

Name Maximum amount of commitment (number of New GVC Shares)
Henderson AIA 5,000,000
Richard Griffiths 783,725
Antisoma plc 1,713,062
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APPENDIX IV

The following definitions apply throughout this announcement unless the context requires otherwise:

"Additional Sportingbet Convertible Bonds"

the £15 million 7 per cent. convertible bonds due 2016 issued by Sportingbet on 25 May 2012

"Admission"

the admission or re-admission (as applicable) to trading on AIM of the GVC Shares in issue upon the Scheme becoming effective (including the New GVC Shares)

"AIM"

a market operated by the London Stock Exchange

"AIM Rules"

the rules published by the London Stock Exchange which set out the rules and responsibilities in relation to a company with a class of securities admitted to AIM, as amended from time to time

"Amounts Wagered"

the gross takings receivable from customers in respect of individual bets

"Approvals"

regulatory authorisations, orders, recognitions, grants, consents, licences, confirmations, clearances, permissions and approvals

"associated undertaking"

has the meaning given in paragraph 19 of schedule 6 to the Large and Medium - sized Companies and Groups (Accounts and Reports) Regulations 2008 other than paragraph 19(1)(b) of that schedule.

"Australian Licence Approval"

the obtaining by William Hill Australia of the approvals set out in condition 3(d) of Appendix I to this announcement

"Australian Foreign Investment Review Board Approval"

approval issued by or on behalf of the Treasurer of Australia that there is no objection to the Proposed Australian Transaction under FATA or the expiry of the relevant period following the giving of notice related to the Proposed Australian Acquisition under section 26 of the FATA without any interim or permanent order of prohibition being made

"Australian Regulatory Authority"

the NT Commission, the Treasurer of Australia and the Australian Competition and Consumer Commission

"B2B"

Business to Business

"B2C"

Business to Consumer

"Business Day"

a day, other than a Saturday, Sunday or public or bank holiday, on which clearing banks are open for normal business in the City of London

"City Code"

the City Code on Takeovers and Mergers issued from time to time by or on behalf of the Panel

"Change of Control Conversion Price"

as such term is defined in the offering circular dated 6 June 2011 pertaining to the Original Sportingbet Convertible Bonds

"Closing Price"

the closing middle price of a share on a particular trading day, as derived from the London Stock Exchange Daily Official List

"Companies Act"

the UK Companies Act 2006 (as amended, modified, consolidated, re-enacted or replaced from time to time)

"Court"

the High Court of Justice in England and Wales

"Court Hearings"

the Scheme Court Hearing and the Reduction Court Hearing and "Court Hearing" means either one of them, as the context requires

"Court Meetings"

the Shareholder Court Meeting and the Sportingbet Convertible Bond Court Meeting and "Court Meeting" means either one of them, as the context requires

"Court Orders"

the Scheme Court Order and the Reduction Court Order

"CREST"

the relevant system (as defined in the Uncertified Securities Regulations 2001 (SI 2011 no.3755) in respect of which Euroclear is the Operator (as defined in the Uncertified Securities Regulations)

"Daniel Stewart"

Daniel Stewart & Company plc

"Disclosed"

(a) referred to in Sportingbet's annual report and accounts for the    financial year ended on 31 July 2012;

(b) contained in this announcement;

(c) publicly announced by Sportingbet in accordance with the Listing Rules prior to the publication of this announcement (by       delivery of an announcement to a Regulatory Information Service); or

(d) as otherwise fairly disclosed in writing by or on behalf of Sportingbet or any of its advisers to both William Hill Australia and GVC (or their respective directors, officers, employees, agents or professional advisers) in connection with the Offer, prior to the day falling two Business Days prior to the date of this announcement (including, but not limited to, in minutes of any disclosure meetings)

"Effective Date"

the date on which Part 2 of the Scheme becomes operative and the Reduction of Capital becomes effective in accordance with the terms of the Scheme

"Effective Time"

the time on the Effective Date at which Part 2 of the Scheme becomes operative and the Reduction of Capital becomes effective

"Election Return Time"

5.00 p.m. on the Business Day following the Scheme Court Hearing;

"Enlarged GVC Group"

the GVC Group, as enlarged by the acquisition of the Remaining Sportingbet Businesses pursuant to the Scheme

"EPC"

East Pioneer Corporation B.V.

"Euroclear"

Euroclear UK & Ireland Limited, a company incorporated in England and Wales with registered number 2878738

"Excluded Shares"

any Sportingbet Shares legally or beneficially held by any member of the GVC Group

"FATA"

the Foreign Acquisitions and Takeovers Act 1975 (Cth)

"Final Dividend"

the final dividend of 1.1 pence per Sportingbet Share in respect of the year ended 31 July 2012

"Form of Election"

the form of election for use by an eligible Scheme Shareholder to participate in the Mix and Match Facility

"Forms of Proxy"

the proxy forms to be sent to Sportingbet Shareholders in connection with their voting instructions at the Shareholder Court Meeting and Sportingbet General Meeting respectively and the proxy form to be sent to Sportingbet Convertible Bondholders in connection with their voting instructions at the Sportingbet Convertible Bond Court Meeting and "Form of Proxy" means any one of them as the context requires

"FSA"

the UK Financial Services Authority

"FSMA"

the UK Financial Services and Markets Act 2000, as amended from time to time

"Guernsey Properties"

eight freehold properties located in Guernsey and each held by direct and wholly owned subsidiaries of SB Properties (Guernsey) Limited, a member of the Sportingbet Group

"GVC"

GVC Holdings plc, a public company limited by shares, incorporated in the Isle of Man with company number 4685V

"GVC Directors"

the directors of GVC for the time being

"GVC General Meeting"

the general meeting of GVC Shareholders to be convened in connection with the Scheme to consider and, if thought fit, approve the GVC Shareholder Resolution (with or without amendment) including any adjournment of such meeting

"GVC Group"

GVC and its subsidiaries and subsidiary undertakings from time to time

"GVC Prospectus"

the prospectus relating to the Enlarged GVC Group and Admission

"GVC Shareholders"

holders of GVC Shares

"GVC Shareholder Circular"

the circular to be sent to GVC Shareholders on or around the date of the Scheme Document containing the notice of the GVC General Meeting

"GVC Shareholder Resolution"

such resolution or resolutions as are necessary to approve, implement and effect the Offer and the acquisition of Scheme Shares by GVC (as such resolutions may be set out in the GVC Shareholder Circular, including a resolution or resolutions to increase the share capital of GVC and authorise the creation and allotment of the New GVC Shares)

"GVC Shares"

the ordinary shares of EUR 0.01 each in the capital of GVC

"Henderson AIA"

Henderson Alternative Investments Advisers Limited, acting in its capacity as discretionary investment manager of the Alphagen Volantis Fund Limited

"Henderson Global Investors"

Henderson Global Investors Limited

"Lazard"

Lazard & Co., Limited

"London Stock Exchange"

London Stock Exchange plc

"Long Stop Date"

31 May 2013, or such earlier or later date as Sportingbet, William Hill Australia and GVC may agree and the Panel and/or the Court may allow

"Mix and Match Facility"

the mix and match facility under which Scheme Shareholders (other than any Restricted Overseas Shareholders) may elect to vary the proportions in which they receive cash and New GVC Shares under the Scheme

"New GVC Shares"

the new GVC Shares to be allotted and issued pursuant to the Scheme

"Nominated Adviser"

an adviser for companies admitted to AIM that is approved by the London Stock Exchange (LSE)

"NT Act"

the Racing and Betting Act 1989 (NT)

"NT Commission"

the Northern Territory Racing Commission

"NT Licences"

licences to conduct business of sports bookmaker granted by the NT Commission to each of Centrebet Pty Limited (dated 2 December 2011) and Sportingbet Australia Pty Limited (dated 28 November 2011)

"Offer"

the proposed offer for Sportingbet by means of the Scheme or, should William Hill Australia and GVC so elect, by means of a takeover offer together with the transfer of the Regulated Sportingbet Businesses and the Guernsey Properties to members of the William Hill Group

"Offer Period"

the offer period (as defined by the City Code) relating to Sportingbet, which commenced on 19 September 2012

"OFT"

the Office of Fair Trading of the United Kingdom (or any successor authority or authorities carrying out consumer credit regulatory and/or competition law and merger control enforcement functions in the United Kingdom from time to time)

"Ora Capital"

Ora Capital Partners Limited

"Original Sportingbet Convertible Bonds"

the £65 million 7 per cent convertible bonds due 2016 issued by Sportingbet on 8 June 2011

"Panel"

the Panel on Takeovers and Mergers

"Proposed Australian Acquisition"

the proposed acquisition by William Hill Australia of all the issued share capital in the relevant Sportingbet subsidiary undertakings together with certain other assets which constitute the Sportingbet Australian Business

"Prospectus Rules"

the Prospectus Rules brought into effect on 1 July 2005 pursuant to Commission Regulation (EC) No 809/2004 and published by the FSA pursuant to section 73A of FSMA

"Reduction Court Hearing"

the hearing at which the Reduction Court Order will be sought

"Reduction Court Order"

the order of the Court confirming the Reduction of Capital

"Reduction of Capital"

the proposed reduction of the share capital of Sportingbet under Chapter 10 of Part 17 of the Companies Act provided for by the Scheme

"Registrar of Companies"

the Registrar of Companies of England and Wales

"Regulatory Authority"

any government, government department or governmental, quasi-governmental, supranational, statutory, regulatory, environmental, or  investigative body, court, trade agency, association, institution or any other body or person whatsoever in any jurisdiction

"Regulated Sportingbet Businesses"

the Sportingbet Australian Business and the Sportingbet Spanish Business

"Remaining Sportingbet Businesses"

all businesses and assets of the Sportingbet Group, other than the Regulated Sportingbet Businesses and the Guernsey Properties

"Reorganisation Record Time"

5.00 p.m. on the Business Day immediately prior to the Reduction Court Hearing

"Restricted Jurisdiction"

any jurisdiction where Sportingbet, GVC and William Hill Australia are advised the extension of,  availability or issue of New GVC Shares would violate the law of that jurisdiction or would result in a requirement to comply with any other governmental or other consent or any registration, filing or other formality which Sportingbet, William Hill Australia and GVC, in their absolute discretion, regard as unduly onerous

"Restricted Overseas Shareholder"

a holder of Scheme Shares whose registered address is in any Restricted Jurisdiction or who is resident in any Restricted Jurisdiction and who has not, prior to the Election Return Time been able to satisfy Sportingbet, William Hill Australia and GVC, in their absolute discretion, that the making of an election by that holder is exempt from or not subject to the registration or other legal or regulatory requirements of the relevant Restricted Jurisdiction

"Scheme"

the scheme of arrangement proposed to be made under Part 26 of the Companies Act, details of which are to be set out in the Scheme Document with or subject to any modification, addition or condition approved or imposed by the Court and agreed to by Sportingbet, William Hill Australia and GVC

"Scheme Court Hearing"

the hearing at which the Scheme Court Order will be sought

"Scheme Court Order"

the order of the Court sanctioning the Scheme under section 899 of the Companies Act

"Scheme Document"

the circular to be sent to Sportingbet Shareholders and Sportingbet Convertible Bondholders setting out, inter alia, the terms of the Scheme and the notices convening the Court Meetings and the Sportingbet General Meeting

"Scheme Shareholder"

a holder of Scheme Shares

"Scheme Shares"

(i) the Sportingbet Shares in issue (but not held in treasury) at the date of the Scheme Document;

(ii)      any Sportingbet Shares issued (or transferred out of treasury) after the date of the Scheme Document, but on or prior to the Voting Record Time in respect of the Shareholder Court Meeting; and

(iii)     any Sportingbet Shares issued (or transferred out of treasury) after the Voting Record Time in respect of the Shareholder Court Meeting but immediately before the Reorganisation Record Time either on terms that the original or any subsequent holder thereof shall be bound by the Scheme or in respect of which the holder thereof shall have agreed in writing to be bound by the Scheme,

in each case including, where the context so requires, shares arising upon the reclassification of the Scheme Shares to be referred to in Part 1 of the Scheme

but excluding (A) in the case of references to "Scheme Shares" or "Scheme Shareholders" in relation to the Shareholder Court Meeting any Excluded Shares in issue and any Sportingbet Shares managed by the Volantis Capital team and/or legally or beneficially held, or managed, by Richard Griffiths and/or Antisoma plc at the Voting Record Time in respect of the Shareholder Court Meeting and any Scheme Shares referred to in (iii) above and (B) in the case of all other references in the Scheme to "Scheme Shares" and "Scheme Shareholders" any Excluded Shares in issue immediately before the Reorganisation Record Time.

"Shareholder Court Meeting"

the meeting of Scheme Shareholders to be convened by order of the Court pursuant to Part 26 of the Companies Act to consider and, if thought fit, approve the Scheme (with or without amendment) including any adjournment or postponement of any such meeting

"Shareholder Meetings"

the Shareholder Court Meeting and the Sportingbet General Meeting

"Sportingbet"

Sportingbet plc, a public company limited by shares, incorporated in England and Wales with company number 03534726

"Sportingbet Australian Business"

the regulated businesses operated by the Sportingbet Group in Australia under licences issued by the appropriate Australian regulator, which for the avoidance of doubt excludes any European or other businesses operated by the Sportingbet Group under non-Australian licences

"Sportingbet Convertible Bond Court Meeting"

the meeting of Sportingbet Convertible Bondholders, to be convened by order of the Court pursuant to Part 26 of the Companies Act to consider and, if thought fit, approve the Scheme (with or without amendment) including any adjournment or postponement of any such meeting

"Sportingbet Convertible Bondholders"

holders of the Sportingbet Convertible Bonds

"Sportingbet Convertible Bonds"

the Original Sportingbet Convertible Bonds and the Additional Sportingbet Convertible Bonds

"Sportingbet Directors"

the directors of Sportingbet from time to time

"Sportingbet General Meeting"

the general meeting of Sportingbet Shareholders to be convened in connection with the Scheme to consider and, if thought fit, approve the Sportingbet Shareholder Resolution (with or without amendment) including any adjournment or postponement of any such meeting

"Sportingbet Group"

Sportingbet and its subsidiary undertakings as at the date of this announcement and, where the context admits, each of them

"Sportingbet Securities"

securities in Sportingbet

"Sportingbet Share Plans"

the Sportingbet Executive Share Option Scheme 2004, the Sportingbet Restricted Share Plan 2009 and the Sportingbet 2011 Long-Term Incentive Plan

"Sportingbet Shareholders"

registered holders of Sportingbet Shares from time to time

"Sportingbet Shareholder Resolution"

the special resolution of Sportingbet Shareholders amongst other things to amend Sportingbet's articles of association, which is to be considered and, if thought fit, approved (with or without amendment) at the Sportingbet General Meeting

"Sportingbet Shares"

ordinary shares of 0.1p each in the capital of Sportingbet

"Sportingbet Spanish Business"

the regulated businesses operated by the Sportingbet Group in Spain under licences issued by the appropriate Spanish regulator, which for the avoidance of doubt excludes any South American or other businesses operated by the Sportingbet Group under non-Spanish licences

"subsidiary undertaking"

has the meaning given in section 1162 of the Companies Act

"Substantial Interest"

a direct or indirect interest in 20 per cent or more of the total voting rights conferred by the equity share capital (as defined in the Companies Act)

"Transfer Agreement"

the transfer agreement to be entered into by William Hill, William Hill Australia, GVC and Sportingbet, governing the transfer of the Regulated Sportingbet Businesses from Sportingbet to members of the William Hill Group

"undertaking"

has the meaning given in section 1161 of the Companies Act

"UBS"

UBS Global Asset Management (UK) Ltd.

"UK Listing Authority"

the FSA acting in its capacity as the competent authority for listing under FSMA

"US Securities Act"

the United States Securities Act of 1933, as amended

"Volantis Capital team"

the investment management team operating at Henderson Group plc and/or any of its subsidiary undertakings under the Volantis Capital name and led by Adam McConkey, or his successor, together with any other employees in Henderson Group plc and its subsidiary undertakings from time to time who may be behind the same information barrier as that team

"Voting Record Time"

the last date and time upon which entitlement to vote at the Court Meetings will be determined which will be set out in the Scheme Document, or if a Court Meeting is adjourned, 6.00 p.m. on the second day before the date of such adjourned meeting

"William Hill"

William Hill plc, a public company limited by shares, incorporated in England and Wales with company number 04212563

"William Hill Australia"

William Hill Australia Pty Limited, a company incorporated in the State of Victoria with Australian Company Number 161652973

"William Hill Group"

William Hill and its subsidiaries and subsidiary undertakings from time to time

"William Hill Online"

the subsidiary companies of William Hill that own and operate its existing online gambling operations

"Wider GVC Group"

GVC and its subsidiaries, subsidiary undertakings, associated undertakings and any other undertaking in which GVC and such undertakings (aggregating their interests) have a Substantial Interest

"Wider Sportingbet Group"

Sportingbet and its subsidiaries, subsidiary undertakings, associated undertakings and any other undertaking in which Sportingbet and such undertakings (aggregating their interests) have a Substantial Interest

"Wider William Hill Group"

William Hill and its subsidiaries, subsidiary undertakings, associated undertakings and any other undertaking in which William Hill and such undertakings (aggregating their interests) have a Substantial Interest

All references to "pounds", "pounds Sterling", "Sterling", "£", "pence", "penny" and "p" are to the lawful currency of the United Kingdom.

All the times referred to in this announcement are London times unless otherwise stated.

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