More than £1.1billion has been wiped off the value of Britain’s biggest betting firms as the Government prepares to clamp down on highly addictive gambling machines.
Government sources say Chancellor Philip Hammond is ready to slash the maximum stakes for fixed odds betting terminals – known as the ‘crack cocaine’ of the gambling industry – from £100 to £2.
The move would go much further than the Gambling Commission’s recommendation last month of a stake limit of up to £30.
The Chancellor is now thought to be looking at ways to fill the £400million hole in public finances that a £2 stake limit would cause.
Addictive: Government sources say Chancellor Philip Hammond is ready to slash the maximum stakes for fixed odds betting terminals from £100 to £2
The speculation decimated the shares of bookmakers, indicating that many investors feel they are no longer worth a punt.
William Hill took the biggest hit, with its shares down 12.7 per cent, or 42.7p, to 293.4p.
It was followed by Ladbrokes owner GVC (down 6 per cent, or 58.5p, to 912.5p), Paddy Power (down 4.9 per cent, or 355p, to 6965p), gambling software firm Playtech (down 2.9 per cent, or 23.8p, to 800p) and 888 (down 2.5 per cent, or 7.2p, to 275.6p).
The FTSE 100 ended the day 0.36 per cent higher, or 26.53 points, at 7425.40, while the FTSE 250 was down 0.60 per cent, or 121.06 points, at 20,195.31.
Stock Watch – Vitesse Media
Vitesse Media shares crashed after it revealed bigger-than-expected losses and its finance chief Edward Riddell quit.
The AIM-listed digital media company was expecting a ‘small’ loss for the year ending March 31.
But it now expects to be in the red to the tune of £380,000. It has been hit by fewer big ticket sales, a restructuring programme and fees for potential deals that have not completed, costing it around £125,000 in total.
Shares plummeted 30.8 per cent, or 1p, to 2.25p.
Sticking with the FTSE 100, the back-and-forth between Shire and Takeda continues.
Rare diseases drug maker Shire says it is considering a fourth offer from Japanese rival Takeda that values it at £42.8billion. Shire shares rose 3.4 per cent, or 130p, to 3930p.
Qinetiq was one of the FTSE 250’s biggest gainers after agreeing a £61.3million deal to buy EIS Aircraft Operations, which provides flight training for the German armed forces and the US Air Force in Europe.
The deal will accelerate Qinetiq’s ‘international growth strategy’, the firm said. Shares hopped 2.9 per cent, or 6.5p, to 231.7p.
Meggitt, the aerospace engineering firm, has sold subsidiary Precision Micro to LDC, the private equity arm of Lloyds Banking Group, for £22.5million in cash.
Precision Micro specialises in photo chemical etching for the automotive and medical sectors.
Meggitt says the deal is part of its strategy to focus on markets where there is a ‘greater potential for growth’.
Meggitt shares dipped 0.3 per cent, or 1.3p, to 460.5p.
Spanish drug maker Laboratorios Farmaceuticos Rovi has given Hikma Pharmaceuticals the exclusive rights to market and distribute enoxaparin, its generic treatment for deep vein thrombosis and pulmonary embolism.
Despite the news, Hikma shares slid 2.3 per cent, or 29p, to 1229p.
Paragon Banking Group’s shares edged down 0.4 per cent, or 2p, to 522p after Investec cut the FTSE 250 firm’s rating from ‘buy’ to ‘hold’.
Analysts at Liberum cut gift card seller Card Factory from ‘buy’ to ‘hold’ but raised its target price from 210p to 240p. Shares slumped 3.6 per cent, or 8.6p, to 231.8p.
In the small caps, conference and exhibition organiser ITE Group sold its Malaysian events business to rival UBM for £4.2million.
The subsidiary, Trade Link ITE, owns Metaltech, a metalworking exhibition in the South East Asian country. ITE shares hopped 2.9 per cent, or 4.6p, to 151.4p.
A £23.2million loss in 2017 caused shares in betting technology firm Sportech to dive. But despite the loss, analysts backed the struggling betting firm to take advantage of the potential legalisation of sports betting in the US, which could provide rich pickings for European operators.
Giving the firm a ‘hold’ rating, broker Peel Hunt said: ‘We believe the upside potential from US sports betting offsets the issues with the underlying business.’ Shares dived 5.5 per cent, or 3.6p, to 61.4p.