For Sale: U.K. Bookies
U.K. bookmakers Ladbrokes and Gala Coral, which have merged to form the nation’s biggest retail bookmaker with 4,000 outlets, may be required to sell off some of their assets to avoid monopoly concerns.
The merger must undergo scrutiny by the country’s Competition and Markets Authority. According to SBC News, Irish betting operators Paddy Power and Boylesports are also looking at the new company’s retail inventory in order to expand their own U.K. services and market presence.
Both companies operate extensively in the U.K., and international operations will initially account for only about 11 percent of the merged company’s total revenue.
According to published reports, the two firms will combine their digital innovation teams to strengthen products, but the firms intend to maintain two trading teams and allow for independent pricing of events and offers.
Ladbrokes CEO Jim Mullen will serve as CEO of the merged company and Gala Coral CEO Carl Leaver will serve as executive deputy chairman for a 12-month period.
Leaver said his primary responsibility will be to realize synergies from the merger, which he expects will be about £65 million, most of that coming in the second year following the merger, which the companies expect to conclude mid-2016.
As a result of the merger, reports the Irish Independent, Ladbrokes will close 51 of its 196 bookies in Eire and lay off 90 of 840 employees. The Irish arm of Ladbrokes, which had sought court protection, is now back in the black with around €3.8 million (US$4.1 million) to pay off debts, along with additional millions in working capital and money for capital expenditure purposes.
