Rank and 888 make £3.6bn offer for William Hill, report says

William Hill shares spiked on Tuesday after reports emerged that Rank Group and 888 Holdings had made a formal £3.6bn takeover offer for the stumbling bookmaker.

Casino group Rank and online gaming specialist 888 were reported to have come up with a slightly higher bid than previously rumoured, according to the Financial Times, with a formal offer of 364p per share.

The pair will also set out targeted savings from the merger that will apparently somehow boost the value to 408p per share, according to the newspaper's sources.

Last month Rank and 888 revealed they had begun talks about a joint takeover approach for the high street bookmaker, which axed chief executive James Henderson earlier in July after his recent tenure saw the delivery of multiple profit warnings.

Hill's, which itself failed in a £700m bid for 888 last year due to an inability to agree on a price, stressed that it had received "a highly preliminary approach" and questioned whether a merger with Rank and 888 would "enhance William Hill's strategic positioning or deliver superior value to William Hill's strategy".

Interim results last Friday were fairly reassuring, with few surprises and management holding guidance on full year operating profits after benefitting from a strong Euros performance that offset the poor performance in the major horseracing festivals.