You are here

GVC to buy online bookmaker Ladbrokes for up to US$5.4b

[GENEVA] GVC Holdings Plc agreed to buy UK bookmaker Ladbrokes Coral Group Plc for as much as £4 billion (S$7.1 billion) as gambling companies seek greater scale in a business that's shifting online.

Investors will receive as much as 207.2 pence for every Ladbrokes share, the companies said in statements Friday. That would be 19 per cent higher than Thursday's closing price.

A combination of GVC, which owns online gambling platforms including Partypoker and Sportingbet, and betting-shop operator Ladbrokes Coral could spark even more consolidation in the sector. Ladbrokes Coral, whose traditional betting shops in the UK's town centers are fading, would get more exposure to the expanding digital gaming business, while GVC could reach more potential customers for its online platforms.

The merger would follow previous combinations like that of Paddy Power and Betfair as well as Ladbrokes with Coral.

sentifi.com

Market voices on:

The bid consists of 32.7 pence and 0.141 GVC shares and a contingent payment of as much as 42.80 pence a share. The value of the contingent right would be determined by the outcome of a UK regulatory review of electronic betting terminals, according to the statement. That could result in sharply reduced wagers via the machines, cutting shop owners' revenue.

Speculation about a combination of GVC and Ladbrokes emerged last year, and the companies announced they were in advanced talks on Dec 7.

BLOOMBERG