888 to Remain on UK Soil After Surviving Gambling Commission Licence Review

Gambling Commission LogoThere were fears that one of the oldest names in sports betting was to be no more.

888sport acquired the rights to the William Hill betting empire in 2022, paying a cool £2.2 billion for the privilege.

All was going smoothly in this new business arrangement – until 888 chiefs were hauled up in front of the UK Gambling Commission over accusations of a hostile takeover at the parent company.

Indeed, so significant was the potential change of ownership at the firm, the regulator admitted that 888’s UK operating licence was under review.

Happily for all involved, the Commission has completed their investigation – and no further action will be taken.

Taking Over

It all kicked off in the summer of 2023.

FS Gaming is a company set up by a trio of investors with a long history in sports betting – notably Kenny Alexander, former CEO of Entain, and Lee Feldman, the former chairman at the same firm.

They acquired a 6.6% stake in 888 Holdings last year, which was to be used as a launchpad for a more formal bid, via a higher shareholding, to take over the leadership and running of the firm.

No problem, you might think – 888 would benefit from having such experience come on board. But there’s a rule in the UK gambling sector which decrees that when a single entity acquires a shareholding of 10% or more, it’s considered to be a change of ‘corporate control’.

In these cases, the change must be approved by the Gambling Commission – who, of course, were never going to give the green light given the criminal misdemeanours under investigation at Entain. Alexander has also faced previous criminal charges; memorably being fined in 2021 after he was found guilty of stealing a food delivery van from outside of a kebab shop while on a night out.

That centred around a historical legal case brought by the HMRC, with a list of charges – including alleged breaches of the Bribery Act 2010 – hanging over them. Alexander and his associates were on the senior management team at the time of the alleged wrongdoings, which relate to one of the firm’s subsidiary businesses in Turkey.

So when FS Gaming acquired their share in 888, it triggered an automatic licence review by the UK Gambling Commission – a scenario in which they have the power to reject the change of corporate control and/or revoke an operator’s licence. What’s more, once such a decision has been made, it cannot be overturned by law.

And so 888 has been in stasis ever since – allowed to continue to operate on UK soil, but with their activities under investigation by the regulator.

Moving On

Unsurprisingly, this rather spurred 888 into making a tough decision.

They decided to call an end to the proposed leadership bid of Alexander and his associates, revealing their apprehension over the change of management – admitting that when quizzing the trio, ‘basic assurances that addressed these concerns were not forthcoming.’

“As a board, we devoted significant time to considering FS Gaming’s proposal,” said 888 chair Lord Mendelsohn. “However, following in-depth regulatory due diligence including engaging closely with the GBGC [Gambling Commission], the board had no option but to terminate discussions as it simply could not put licences in our largest market at significant risk.”

While 888 awaited news of their licence review, Entain finally came to an amicable arrangement with the Crown Prosecution Service – there’s was the first ‘deferred prosecution agreement’ in history, paying a fine and a ‘disgorgement’ of profits worth a whopping £585 million, as well as forking out for legal costs and a £20 million charitable donation.

All of which means that the FS Gaming founders are free to invest in other gambling operators again – although it’s unlikely that their 888 proposal will be revisited.

The Other Side

The Commission completed their investigation into 888 Holdings this week, and found no reason to strip them of their UK operator’s licence.

All of which means they are free to continue operating in the domestic market, ensuring their brand – and that of William Hill – lives on.

It brings the curtain down on a period of upheaval at 888, whose fortitude was tested in December when gambling software firm Playtech made a £700 million takeover bid for them.

The offer was rejected, but only on the grounds that shareholders believed that it undervalued 888 – not because they weren’t interested in selling up.

It comes just weeks after 888 admitted they were considering selling the American arm of their business after finding the competition in the United States too taxing.