Ladbrokes gambles on giant bookie deal
Fri close: Bookmakers Ladbrokes was off 4.2p at 124.1p at the close after announcing agreed merger terms with Gala Coral that will create a £2.3 billion business. It will be Britain’s largest high street betting group and better able to compete in the online market.
The latest deal in the gambling sector comes only a week after online betting company 888 agreed a £900 million takeover of rival Bwin.party.
Ladbrokes will view the Coral merger as an opportunity to catch up with larger rival William Hill’s online presence. It said it would issue new ordinary shares to existing Gala Coral shareholders representing 48.25% of the enlarged company. Existing Ladbrokes investors will own 51.75% on the same basis.
Gala Coral Group is owned by a group of private equity ompanies including Apollo, Anchorage and Cerberus.
To help fund the deal, announced after talks were revealed last month, Ladbrokes is placing 93 million new shares, representing 10% of the company.
Investors braved weaker than expected readings on Chinese and Eurozone manufacturing and lingering worries regarding Greece,.
The FTSE100 index was off 75.2 pts at 6,579.81.
Shares in Aggreko tumbled 12.24% or 175p to 1,255p after the temporary power provider said its interim and full-year results are likely to miss market expectations as a result of on-going security challenges in Yemen and a further slowdown in its North American oil and gas related business.
Shares in drinks owner AG Barr fell after it said first-half profits would drop by about 5% compared with the year before. The stock fell 27p or 4.27% to 606p.
Vodafone said it has made a good start to the year, with organic service revenue up 0.8% in the quarter ended 30 June as the European businesses return to growth and customer demand for 4G and data takes off.
Service revenue is the money the mobile phone company gets from customers’ plans and traffic on its network. The figures came in better than expected and ahead of the 0.1% increase in the fourth quarter. Shares were up 6.5p at 238.45p.