GVC Reportedly Makes Second Attempt at Ladbrokes Coral Takeover
Reports emerged this week that the online gambling group GVC made a second attempt to take over Ladbrokes to create one of the world’s largest betting companies.
It is said that GVC offered as much as £3.6 billion but that talks broke down and are no longer going on.
However, many are taking the reports as a further sign that British gambling groups are preparing for a fresh round of consolidation with deal-making disrupted as the sector anticipates more regulatory crackdowns from UK authorities.
It is thought that talks between the companies broke down for a number of reasons including disagreements over the company’s value. With uncertainty surrounding the UK government’s review into the gambling sector that is due to be released in the coming months, it is hard for analysts to accurately predict the future value of gambling companies.
GVC reportedly valued Ladbrokes Coral at around 140p per share, or £2.7 billion. However, the online gambling company also proposed an uplift of about 50p per share depending on what the regulatory review produces. This could have made the final price as high as £3.6 billion.
It is expected that the UK review will result in a clampdown on fixed-odds betting terminals, instore gambling machines that have been labelled as the “crack cocaine of gambling”.
Some are arguing for the maximum bets allowed on the machines to be reduced from £100 to £2. If that were to happen it is estimated that Ladbrokes Coral could lose close to £450 million in machine revenues next year.
In recent years GVC has made a number of deals such as the acquisition of Bwin.party in a £1.1 billion deal.