Boylesports to run rule over Coral and Ladbrokes shops
UK watchdog says merger of betting shops would create substantial loss of competition
Ladbrokes and Coral may have to sell as many as 400 shops to get approval of a merger that would create the Britain’s biggest betting-shop chain, the UK’s competition watchdog said.
The UK’s Competition and Markets Authority (CMA) has told the pair that they may have to sell as many as 400 outlets to get its approval for the deal, which create the Britain’s biggest betting-shop chain.
Irish independent bookmaker Boylesports made it clear yesterday that it would run the rule over the shops that are likely to come on the market as a result.
“We welcome this morning’s decision by the UK’s Competition and Markets Authority concerning the proposed merger of Ladbrokes and Gala Coral, ” the company said.
“The possible availability of between 350 and 400 shops offers a clear opportunity for Boylesports to realise its long-term ambition to develop a significant retail presence in the UK.”
Boylesports founder and chief executive, John Boyle, told The Irish Times in late 2014 that the Irish company was interested in getting a presence on British high streets.
Ladbrokes and Coral operate in 659 areas where their planned merger would create a “substantial” loss of competition, the Competition and Markets Authority said Friday in its provisional report on the deal.
Should Ladbrokes gain full approval, the combined business will be called Ladbrokes Coral Plc and will have annual net revenue of £2.1 billion (€2.7 billion).
The CMA’s decision is “very, very positive” for the companies, said Alistair Ross, an analyst at Investec who has a “buy” rating on Ladbrokes. “The number of shops is well below expectations, which were for sales of between 500 and 800 shops.”
Ladbrokes shares climbed 7.5 per cent to 129 pence in early trading . in London.Ladbrokes agreed to buy Coral in July in a share-exchange deal to create a chain with about 4,000 betting shops.
The move is Ladbrokes’ second attempt to acquire Coral, after regulators blocked its bid in 1998.
“It’s a significant step,” a Ladbrokes spokesman said. “We’ll work closely with the CMA to implement the remedy. Our focus will be to find a suitable buyer or buyers” for the shops.The CMA’s final report will be published at the end of July.
Additional reporting: Bloomberg