Duke Street intrigued by IG Index

The UK private equity firm is reported to be interested in merging portfolio business Sporting Index with UK spread-betting company IG Index.

UK private equity house Duke Street Capital looks set to continue its foray into the UK betting market, with reports suggesting that the firm is planning to acquire in UK spread-betting company IG Index.

 

Stuart Wheeler, who founded IG Index in 1974, confirmed last week that he is planning to sell his 24 per cent stake in the business, which equates to around 13 million shares. The current IG share price of 221 pence per share gives his stake a value of just under £29m. IG confirmed that other shareholders were considering selling their stakes and that “the total number of shares which might be sold is likely substantially to exceed 30 per cent of the Company’s issued capital.”

 

In last weekend's Sunday Times newspaper, sources close to Duke Street described IG Index as “an intriguing opportunity”. Duke Street and IG Index have both declined to comment on reports of an offer for the business, which is currently valued at around £120m.

 

Duke Street is interested in merging IG Index, which specialises in financial spread-betting, with Sporting Index, the UK market leader for sports spread-betting, which it acquired in December for £55m.

 

Duke Street is likely to be challenged in a bid for IG Index by rival private equity firms and possible trade buyers, including City Index. Talk of a deal for IG comes on the back of reports over the weekend that Candover and Cinven are close to finalising a £1.25bn offer for UK bookmaker Coral from its current owner CSFB Private Equity.