Published: Thu, December 07, 2017
Worldwide | By Isabel Fisher

Ladbrokes Coral talks over takeover by Bwin owner GVC

Ladbrokes Coral talks over takeover by Bwin owner GVC

Ladbrokes Coral shares jumped as much as 29 percent, with GVC up as much as 8.3 percent, early Thursday in London.

Since becoming chief executive a decade ago, the Scot has built GVC through a series of increasingly ambitious deals, including the 1.1 billion pound reverse takeover of Bwin.Party, growing it from an upstart gambling firm to a FTSE 250 business.

As mentioned above, the gambling companies in the United Kingdom have been preparing for further consolidation in the local betting industry for months now, with the dealmaking process being interrupted by the further regulatory measures imposed by United Kingdom authorities.

"We've come along in a fairly short period of time, we're very proud of what we've achieved", Alexander said.

GVC Holdings Plc is in advanced talks to acquire United Kingdom bookmaker Ladbrokes Coral Group Plc for as much as 3.9 billion pounds ($5.2 billion), as gambling companies seek greater scale in a business that's shifting online.

Ladbrokes Coral added: "Any transaction would also enhance the enlarged group's position in a number of the world's largest regulated online gaming markets, including the UK, Italy and Australia, and would significantly increase GVC's current share of revenues from locally regulated/taxed markets to more than 90 per cent".

The review is part of a government crackdown on FOTBs after MPs raised concerns the machines were too addictive and fuelled problem gambling.


The value of this would be determined by reference to the outcome of the current review of gaming machines and its estimated impact on the run-rate profitability of Ladbrokes Coral's United Kingdom business.

Following its so-called triennial review, the government said in October that the maximum stake allowed on FOBTs could be sharply cut over concerns they fuel addiction.

GVC, which owns Sportingbet and Foxy Bingo, has put forward a cash-and-shares offer valuing Ladbrokes at 160.9p a share, with additional loan notes worth 42.8p a share.

Last month, GVC announced the sale of its Turkish subsidiary, removing a potential obstacle to a deal with Ladbrokes, which had raised this as one sticking point during August's talks.

"This triennial review has run and run and run and with the political climate in the United Kingdom who knows how much longer it may well run for?" he said.

The merger would follow previous combinations like that of Paddy Power and Betfair as well as Ladbrokes with Coral. The reduction is expected to badly hit the income from Ladbrokes Coral's 3,500 betting shops, potentially reducing the firm's net value.

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