The betting company, Betfair, has spent £5 million to acquire various assets from Blue Square, which includes their customer base. Punters attempting to login to their Blue Square accounts will be redirected to the Betfair site, where they can enjoy the various things on offer, including the company’s well-known and much-loved betting exchange. The acquisition has been touted as being ‘consistent’ with Betfair’s strategy.
Blue Square was owned by the Rank Group plc and at one point was the main sponsor of the UK Poker Tour, which was organised by the sister company Grosvenor. Whilst the deal between Rank and Betfair has been known for some time by those in the industry, today’s news moves to confirm that it’s gone through. Rank are seemingly content in concentrating on land-based gaming and their online casino brand.
What the Move Means for Punters
To all intents and purposes, not much actually changes for the customers of Blue Square. Whilst the website is no longer operational, their customers will be re-directed to Betfair when they attempt to load it up. They can then sign in to Betfair and take advantage of an offer of a welcome bonus, meaning that they’ll be then be able to place bets and use the site’s other assets as they wish.
Betfair offers punters a ‘full suite of sports betting and gaming products’, according to the company’s Corporate Communications office. One question that we don’t have answers to at the moment is how, exactly, Betfair will choose to value Blue Square’s various VIP schemes and the promotions that were regularly offered to customers. It’s also not clear what will happen to customers that already have a Betfair account.
It Furthers Betfair’s Appeal
Having launched in June of 2000 as a betting exchange site, Betfair’s popularity grew steadily in the years that followed. The company launched a traditional sportsbook last year, with the acquisition of Blue Square further ensuring their position in the market. The move also appears to include the Blue Square online power site, which will assist Betfair in their attempts to move into the power market.
Betfair switched its poker offering to the iPoker Network in January of this year, allowing better liquidity than was found when the company was a part of the Ongame Network. Customers who attempt to load the Blue Square online poker site are being redirected to Betfair, similar to what’s happening with sportsbook users. The entire move appears to be about Betfair solidifying its place in various markets.
All Part of Betfair’s Strategy
James Midmer, who is part of Betfair’s Corporate Communications team, confirmed that the Betfair Group had acquired a number of assets from Blue Square in a deal worth £5 million. In his statement, Midmer also outlined the fact that the move was part of Betfair’s wider strategy of ‘focusing on regulated markets’. The move is all part of the company’s plan to grow its various arms alongside the Exchange.
Whilst it’s unlikely the Betfair will ever be know for anything other than the exchange and that is certainly the most powerful arrow in its bow, the fact that it has launched other areas in recent years is telling. It suggested that Betfair aren’t satisfied with merely being an exchange, instead wishing to ensure that other areas like its traditional sportsbook and its gaming operations are also given respect within the industry.
Why Rank Decided to Sell
Whilst the reasoning behind Betfair’s desire to buy Blue Square is clear, the decision of Rank to sell isn’t quite so clear. Rumours of the company’s desire to get rid of the bookmaker began to swirl around the industry back in January, with the main reason being that the bookmaker was under-performing against expectations. The decision to sell for as little as £5 million, though, was the surprising part of it.
Rank bought Blue Square back in 2003 for around £63 million, meaning a £58 million loss is on the cards. That being said, the fact that the Rank Group is willing to take such a hit indicates that it has become something of a problematic part of the company’s portfolio. Sources close to the deal have indicated that it could actually go up as high as £35 million, depending on whether Blue Square meets certain targets.