Ladbrokes and rival firm Gala Coral are two of the biggest gambling firms in the UK right now and next week a merger between the two companies is likely to be completed.
However, despite this report by The Sunday Times, the deal is still yet to receive the approval of the UK Competition and Market Authority who are stating that both operators may have to sell shops for the deal to go through.
The deal, which was first mooted a year ago in June 2005 will lead to the merged business that will be worth more than £2 billion, and it’s thought that upon closure of the deal, Gala Coral senior staff will receive a windfall of £50 million in a deal that doesn’t seem too much of a gamble at all!
While The Sunday Times are reporting the deal is about to go through, the UK Competition and Marketing Authority did initially report that the deal would create a loss of competition, and to offset this both operators may have to sell as many as 500 shops each for the deal to go through.
The potential deal has seen a lot of trading from shareholders in both Ladbrokes and Gala Coral as everyone waits on tenterhooks to see what will happen. Ladbrokes has released a statement this week to shareholders, advising them that they are currently continuing talks with Gala Coral, but that there is no guarantee that the sale will go through, and that it is largely dependent on what the UK Competition and Marketing Authority rule.
Right now it looks as though the whole deal rests on the shop sales, and whether Ladbrokes is prepared to take the hit of hundreds of shops from the merged company.