Ladbrokes and Coral Merger Delayed
It’s been an established fact for some time that two of the UK’s biggest bookmaking companies, Ladbrokes and Coral, are planning to merge in a deal which is worth £2.3 billion. Individually, the two corporations are hugely successful, with high street betting shops in towns and cities across the country, but a combined Ladbrokes-Coral merger would create the largest bookmaking company in the UK.
The deal has hit a few stumbling blocks however, as the Competition and Markets Authority (CMA) has delayed its final decision on the merger due to concerns over anti-competitive implications for other bookmaking companies here. The final decision on the Ladbrokes-Coral merger is still due to take place by the 24th of June this year.
The Ladbrokes-Coral consolidation is the latest in a recent spate of mergers between top gambling companies to secure their future in an increasingly unstable market. The bookmaking industry as a whole has seen profits become increasingly shaky after changes in the UK’s regulation of gambling businesses. Some recent examples include the takeover of bwin.party digital entertainment plc by GVC Holdings, and the merger of Paddy Power and Betfair to create the world’s largest listed online gambling company.
Once the planned merger is finalised, the new company, Ladbrokes Coral, will consist of over 4000 betting shops across the United Kingdom. This new figure will result in William Hill being pushed down into second place, as the established bookmaking giant has just under 2400 betting shops in the UK, a fact that they are not pleased with. They have opposed the merger and complained to the CMA that the deal is anti-competitive. The dominance of William Hill over the British high street will be greatly diminished if the Ladbroke-Coral merger is successfully approved by the CMA. They’ve argued that the market “may not be capable of establishing the third national force which would be lost as a result of this merger.”
One solution to the anti-competition regulation is the proposal that Ladbrokes and Coral sell off some of their shops. They’ve been instructed to shut down between 300 and 500 land-based betting shops between them in order to assuage concerns about competition. However, business experts have suggested the figure could be closer to 1,000 high street betting shops.
