Britain’s largest bookmaker Ladbrokes Coral has confirmed it is in ‘detailed’ discussions over a potential takeover by gambling group GVC. The deal would make Ladbrokes Coral worth a staggering £3.9bn ($5.2bn or €4.4bn) should the deal go ahead.
The announcement sent Ladbrokes Coral’s shares souring, up 25% this morning. GVC shares also climbed 7%. The final valuation will hinge on The UK Government’s review of the Fixed Odds Betting Terminals (FOBT’s) – which is likely to see the maximum stake wagered per spin reduced from £100 to somewhere between £2 and £50 in the near future. Almost all Ladbrokes Coral betting shops have FOBT’s in them and the company is reliant on the profit generated from these machines.
According to market sources, GVC would pay cash and shares under the takeover and Ladbrokes investors would own 46.5% of the combined business. Only last year Ladbrokes Coral was formed after a merger of the two high street bookmakers Ladbrokes and Coral.
GVC is largely made up of online gaming companies which it has been swallowing up in rapid succession. It owns some of the largest internet gambling sites such as Party Poker, Sportingbet, Foxy Bingo among several others.