These days mergers, acquisitions and partnerships are common things and more groups are practising this to create market visibility as well as to strengthen their market share. It is almost the need of the hour for gambling industry as bigger players are acquiring the smaller ones in order to kill the competition. In the similar manner one or more smaller groups are merging together to become big and survive the competition. In a recent move Ladbrokes and the Gala Coral Group entered into a merger agreement with an condition that the group still need to sell up to 400 betting shops before the merger is complete. As per the report of Competition Markets Authority that this £2.3 billion merger of the major sports betting brands will occur but the shops must be done away with to be able to resolve any issues of competition due to this merger.
This merger was announced by the Competition Markets Authority on Tuesday morning after an investigation into the merger took place by the gaming regulator. Prior to the merger it was determined that it would be necessary for both the companies to sell as many as 400 of their betting shops which equals around 1/10 of the combined assets of both groups. This would lower competition in 642 of the local areas where they operate.
Ladbrokes and Coral are both fine with selling of 400 betting shops however analysts felt that they have to offload as many as 1,00 betting shops in order to get their merger approved. Other sports books brands such as Betfred and Boylesports are few brands that have shown interest in purchasing the betting shops. At present Ladbrokes operates 77 betting shops in the northern region of Ireland with 2,150 shops located in Britain. Coral has 1,850 shops located in Britain and after this merger the two will become the largest bookmaker in UK.
Martin Cave, Inquiry Chairman of Competition Markets Authority said:
“Despite the fact that online betting has grown substantially in the past few years, the CMA found that a significant number of punters will visit shops and would continue to visit and wager after the merger is completed. Because of this, the CMA felt that the sale of the shops of the 400 number was needed to protect customers.”