New Betfair CEO taking the axe to many parts of the business.
An interesting article in this weekend’s Sunday Times speculated that new Betfair CEO Breon Corcoran was going to use the company’s half-year results announcement this coming Thursday to outline an overhaul of many parts of the business, and cost cutting measures — and a refocus on its core peer-to-peer betting business. The article speculated that these measures may include plans to shut down or sell LMAX, Betfair’s entrant in the online FX and financial trading space.
Betfair has struggled since a much-ballyhooed IPO in late 2010, seeing its shares decline by 42%, dropping from £13 at pricing to £7.51 currently (see chart below). And LMAX has been one of Betfair’s problem areas — although showing improved results in late 2011 / early 2012, with LMAX monthly volumes crossing $25 billion for the first time, it has continued to lose money, fully £6 million at the EBITDA line last fiscal year (ended April 30, 2012). And Betfair’s partner in the business, Goldman Sachs, exited by selling its LMAX stake back to Betfair earlier this year.
Should be an interesting week. Stay tuned…
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