Bookmakers join forces
Ladbrokes Coral agrees £4bn GVC takeover
Gamble pays off: Ladbrokes to become part of bigger group (photo: Terry Murden)
Gambling giant Ladbrokes Coral has agreed a £4 billion takeover by online rival GVC.
Shareholders in GVC – which already owns the Bwin, Sportingbet and Foxy Bingo – will hold 53.5% of the combined group.
It comes just a year after the merger of bookmakers Ladbrokes and Coral made the new entity the UK’s biggest high street bookmaker.
GVC believes that the enlarged group will be able to achieve recurring annual pre-tax cost synergies of not less than £100 million, including £7m in the first calendar year following completion, rising to £33m by year two and £56m by year three.
It is expected that £100 million of identified cost synergies will be achieved by 2021. The Board of GVC also expects that the acquisition will generate annual capital expenditure savings arising from technology and procurement synergies and revenue synergies.
The new board will comprise Lee Feldman as chairman, Kenneth Alexander as chief executive, Paul Bowtell as chief financial officer and non-executive directors who are expected to be drawn from the current GVC Board.
Mr Alexander said: “The creation of one of the world’s largest listed sportsbetting companies, combining a portfolio of established brands, proven technology and leading market positions in multiple geographies, is a truly exciting prospect.”
John Kelly, Chairman of Ladbrokes Coral said: “In its relatively short time as a merged entity, Ladbrokes Coral has demonstrated why scale can be so effective in this market. The management team have delivered a very successful merger that has created a leading betting and gaming business built on strong brands well positioned in key markets. We have a leading multi-channel offer that utilises our retail and on-line businesses and offers us a promising future.
“Notwithstanding that, the Ladbrokes Coral board believes that the proposed combination with GVC accelerates our strategy to improve the customer experience, drive faster online growth and build a more diverse and extensive international portfolio of businesses.
“The Acquisition has compelling strategic rationale.”
For each share that Ladbrokes Coral shareholders own, they will get 32.7p in cash and 0.141 ordinary GVC shares, plus a “contingent value right” worth up to 42.8p.