Ladbrokes in Merger Talks with Gala Coral Group
Ladbrokes in merger talks with Gala Coral Group
Bookmaker Ladbrokes has said it remains in talks with the board of Gala Coral Group over a possible merger.
A deal would produce the UK's most significant bookie with nearly 4,000 High Street shops.
The conversations issue integrating Ladbrokes with Coral Retail, Eurobet Retail and Gala Coral's online companies.
Ladbrokes stated there was no certainty that the talks would cause a deal, and possible terms and timings were also yet to be concurred.
Shares in Ladbrokes increased more than 11% after the statement.
"A merger with Gala Coral might develop a combined business with significant scale and has the potential to produce substantial cost synergies, creating value for both companies' shareholders," president Jim Mullen said.
If the deal proceeds, it would see the merged group surpass William Hill as the greatest UK bookie, bringing together around 2,100 stores from Ladbrokes and 1,845 from Coral.
The merger talks do not include Gala's 132-strong bingo organization.
Mr Mullen included that the company's board has yet to choose whether a deal would be "strategically appealing" and whether it could be "delivered to investors on proper terms."
The company stated that the offer, if finished, could be classified as a reverse takeover of Ladbrokes.
Ladbrokes formerly tried to buy Coral in 1998, but its scheduled takeover was obstructed by the government.
The then Trade and Industry Secretary Peter Mandelson said a merger would cause "a weakening of price competitors at the nationwide level" and a decrease in consumer choice.
Earlier this year, Ladbrokes reported a big fall in pre-tax profit for 2014, from ₤ 68m to ₤ 38m, and said that it expected to close 60 UK shops this year.
Those strategies would be untouched by any deal with Coral Group.
Ladbrokes in merger talks with Gala Coral Group
Bookmaker Ladbrokes has said it remains in talks with the board of Gala Coral Group over a possible merger.
A deal would produce the UK's most significant bookie with nearly 4,000 High Street shops.
The conversations issue integrating Ladbrokes with Coral Retail, Eurobet Retail and Gala Coral's online companies.
Ladbrokes stated there was no certainty that the talks would cause a deal, and possible terms and timings were also yet to be concurred.
Shares in Ladbrokes increased more than 11% after the statement.
"A merger with Gala Coral might develop a combined business with significant scale and has the potential to produce substantial cost synergies, creating value for both companies' shareholders," president Jim Mullen said.
If the deal proceeds, it would see the merged group surpass William Hill as the greatest UK bookie, bringing together around 2,100 stores from Ladbrokes and 1,845 from Coral.
The merger talks do not include Gala's 132-strong bingo organization.
Mr Mullen included that the company's board has yet to choose whether a deal would be "strategically appealing" and whether it could be "delivered to investors on proper terms."
The company stated that the offer, if finished, could be classified as a reverse takeover of Ladbrokes.
Ladbrokes formerly tried to buy Coral in 1998, but its scheduled takeover was obstructed by the government.
The then Trade and Industry Secretary Peter Mandelson said a merger would cause "a weakening of price competitors at the nationwide level" and a decrease in consumer choice.
Earlier this year, Ladbrokes reported a big fall in pre-tax profit for 2014, from ₤ 68m to ₤ 38m, and said that it expected to close 60 UK shops this year.
Those strategies would be untouched by any deal with Coral Group.