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Ladbrokes to Take Over Gala within the Next Few Days
- July 20, 2015 By Oliver Young -
One of the UK’s best established betting and gaming companies – Ladbrokes PLC – made an announcement that it will very soon taken over another well known name in the business – Gala Coral. The talks about a possible merge started in June, 2015, when Ladbrokes published a press release in which the company confirmed the speculation made by press.
Jim Mullen, CEO of Ladbrokes PLC, then said that acquiring Gala “could create a combined business with significant scale.” Nevertheless, he added that the board was not yet sure whether such collaboration was strategically attractive and could be delivered to on appropriate terms.
However, it seems that the Board has quickly concluded that taking over Gala Coral is a good idea since the latest information reveals the deal is probably going to be inked within a week. This is exciting news for the gambling industry, both land based and online, in the United Kingdom since these two companies will most definitely form a powerful empire.
The Upcoming Merger Is Beneficial for Ladbrokes and Gala Shareholders
Gala Coral is owned by major equity investors such as Apollo Global managements, Cerberus Capital management and Candover Investments. In order to buy this company, Ladbrokes PLC is expected to issue new shares.
Ladbrokes PLC is a giant in the gambling industry not only in the UK, but in Europe as well. The company offers many gambling products including betting shops, online sportsbook, online casino, bingo platform and etc.
Nevertheless, even though the both companies are already appreciated and respected in the industry, it is still believed that a merger will be very beneficial for shareholders from both sides. The main reason for this is the fact that the future collaboration between two leading gaming operators in the UK territory may be a threat to other top operators such as William Hill.
Once the deal is closed and official, Ladbrokes and Gala will have a total value of £3.5 billion and 4,000 shops. Currently, Ladbrokes alone is valued at £1.2 billion.
Ladbrokes Finally Succeeded in Its Intention to Buy Gala
Even though to someone this decision of Ladbrokes to take over Gala may seem surprising, the company has been, in fact, trying to do this for years. Gala has been a top priority to Ladbrokes and its first attempt to acquire the company was made back in 1998. However, due to competition concerns, the deal was prevented.
Mergers of this kind are nothing new in the UK gaming industry that has witnessed many partnerships between well established companies.
For example, the latest takeover was by 888 Holdings when the company bought bwin.party for £898 million. The talks for this possible partnership started in March, 2015, after 888 Holdings had made its takeover bid for bwin.party. Weeks later they reached an agreement and 888 won the race that included two other interested parties – William Hill and GVC Holdings.