Betsoft Gaming Partners with Casino Superlines [...]
GVC and Ladbrokes Coral Merger Approved as GVC Holdings Releases Strong 2017 Final Report
- March 12, 2018 By Oliver Young -
GVC Holdings has had a few great years, with 2017 being possibly one of the best and 2018 promising further improvements. In Friday the company released its final 2017 report, which reveals impressive revenue jump of 13% and a 40% improvement on clean earnings. Additionally, the company remains in the headlines as its shareholders have approved the possible merger with Ladbrokes Coral PLC.
This latest merger on the gambling market was first mentioned in December 2017 and it is expected to create cost synergies of around £100 million annually. Regarding the shareholders’ decision, it was stated that it was made almost unanimously. Last December, GVC signed a £4 billion acquisition deal with Ladbrokes Coral, so the merger with the sister company seemed like a logical step.
It is interesting to note that GVC Holdings in the past had several unsuccessful attempts to take over the UK gambling company, but Ladbrokes Coral was unwilling to enter unregulated markets. Therefore, the opportunity to acquire Ladbrokes Coral became reality only after the Isle of Man-based GVC sold Headlong Limited, its Turkish asset.
Court Decision is Needed Before the Merger Becomes Effective
Even though the shareholders’ decision was warmly welcomed and necessary for things to move forward, another important decision is awaited before anything can become effective. Namely, the court is expected to announce its decision on 26th of March, meaning the merger couldn’t become effective before 28th of March.
In case the court gives green light for the merger, the new business will immediately start trading joint stocks. The majority of the shares i.e. 53.5% will be owned by GVC shareholders, whereas the other 46.5% will belong to Ladbrokes Coral. Once the deal is officialised, GVC would improve its gambling empire with 3,500 betting shops across the UK. However, the deal may also result in closing up to 1,600 jobs from the both companies.
Net Gaming Revenue Reached €925.6 Million
Talks regarding the merger alongside the 2017 final report have resulting in a 2.6% jump of GVC’s shares. After all, the company did report net gaming revenue of impressive €925.6 million in 2017, which is considerably higher than the €794.3 million reported in 2016. Its sports betting division saw a 19% jump in net gaming revenue and reached €331.2 million, while clean earnings reached €239.5 million. On the other hand, the net debt of the company fell from €126.1 million to €108.6 million.
The other GVC brands (Casino Club, PartyCasino, PartyPoker etc.) also witnessed improved revenue; they generated €224 million, which is for 12% up in comparison to the previous year. Out of all GVC brands, PartyPoker was singled out as one of the top performing ones. Namely, its revenue growth in 2017 was incredible 42%, while the global poker market jumped modest 2%.
In addition to the merger news and 2017 report, GVC Holdings didn’t fail to mention its expansion plans for 2018. The company already holds a licence for operating in New Jersey, plus it plans to enter the Brazilian and German gambling markets too.