The recently rumored merger between Ladbrokes and the Gala Coral Group could be completed this week according to a British newspaper.
A potential deal between the two gaming companies hit the headlines back in June when shares in Ladbrokes began to rise.
With speculation rife that a takeover was in the works, a number of industry insiders began clamoring for more information.
Eventually, in a statement given to the Racing Post, Ladbrokes CEO Jim Mullen stated that he is on a mission to expand the company and a merger with Coral was one of his top priorities.
“A merger with Gala Coral could create a combined business with significant scale and has the potential to generate substantial cost synergies,” explained Mullen.
Following this statement the rumor mill stopped churning for a few weeks until it kicked back into life this week following a report by the Sunday Times. Claiming that Ladbrokes is “poised” to seal a deal “this week,” the broadsheet’s report has since reinvigorated speculation that an announcement is about to be made.
Although representatives for Ladbrokes or Coral haven’t commented on the speculation, many experts believe that it’s only a matter of time before a deal is made.
Given that 888 Holdings recently announced that it would be assuming control of bwin.party (a deal which is not yet complete according to a rival bidder for bwin.party) and Amaya is currently thriving after its takeover of PokerStars, there’s a strong possibility that Ladbrokes and Coral will want to follow suit and consolidate their assets.
Should a deal between the two parties come into being, it would make the newly formed entity the largest high street bookmaker in the UK with an estimated value of £3.5 billion ($5.4 billion).
Moreover, it would give Ladbrokes (the company that would, ultimately, assume the assets of Coral), a new lease of life in the iGaming sphere.
As a combined entity, Ladbrokes and Coral would boast an impressive database of customers as well as a strong footing in a number of international territories.
Additionally, with an increased number of resources at its disposal, the new company would almost certainly want to make fresh moves in the online sphere.
Quite what this would mean for online poker players is unclear, but if the Amaya/PokerStars model is any indication of a possible marketing strategy then we could see increased links between Ladbrokes’/Coral’s casino, sports betting and poker portals.
What may also happen is that the new entity will unleash a media campaign aimed at casual players.
PokerStars is currently targeting football fans with its recent signing of Cristiano Ronaldo and Neymar Jr and Ladbrokes/Coral could try something similar given each company’s standing in the sports betting world.
However, for any of this to happen a deal will need to be agreed and that’s by no means a formality. A previous takeover bid by Ladbrokes in 1998 was blocked by the then Trade and Industry Secretary, Peter Mandelson, on the grounds that it would damage competition and harm consumers.
Today, however, the European gaming scene has a much different and it’s unlikely that the government would feel compelled to step in and prevent any deals from going ahead this time around.