MILAN (Reuters) - Italian lottery operator GTECH said on Monday it was in preliminary talks to buy Las Vegas-based slot machine maker International Game Technology in a deal that could involve a cash and paper offer.
In a statement, which confirms what sources told Reuters last week, GTECH said it had hired advisers to help it negotiate the deal. It gave no value for any potential bid.
“This transaction could potentially involve the use of a mix of cash and equity as consideration,” GTECH said, adding it did not anticipate needing a cash call to fund the acquisition.
The news sent shares in IGT up nearly 11 percent on Friday, giving it a market value of close to $4 billion.
Shares in GTECH were down 0.6 percent to 19.5 euros at 0739 GMT, while the Milan blue-chip index was down 0.2 percent.
People familiar with the matter told Reuters on Friday GTECH was competing with billionaire Ron Perelman’s MacAndrews & Forbes Holdings to acquire the U.S. company, which makes slot machines bearing a variety of brands such as that of TV show “Wheel of Fortune.”
Private equity firm Apollo Global Management LLC, a seasoned investor in the U.S. gaming sector and a co-owner of Caesars Entertainment Corp, is also pursuing a bid, as is buyout firm Carlyle Group LP, the people said.
The parties made preliminary takeover offers for IGT and are preparing to submit binding bids in the next few weeks, they said.
Reporting by Francesca Landini; Editing by Sophie Walker