Centrebet has issued
a prospectus on June 1st to do two things. The first is to reduce debt which
according to the prospectus is currently $88 million and the second is to
repay existing shareholders. Either way, a substantial debt of about $45 million
will remain. This is within normal parameters for a publicly listed company
and of course the new company will save millions in interest.
In theory, by doing this
the new public company will make about 5% for shareholders in the first year
according to the prospectus.
We are not advisers but
we do not see that as much reward when you consider the downside potential
that applies to all such enterprises i.e. it is possible to lose.
The one amazing statistic
in the prospectus is that Centrebet has over 200 staff and 60,000 active accounts
and interestingly a substantial proportion of these are poker, casino and
of all things Bingo players. We have to admit, we never thought we would see
the day where Bingo would become a money making online business!
We recommend that anyone
interested in seeing how a corporate bookmaker operates should visit http://www.centrebet.com.au and see the prospectus for themselves.