It is looking like the merger between Ladbrokes and Coral is going to be officially completed soon. The CEO of Gala Coral, Carl Leaver, recently came out and spoke on the subject, saying he believed that it was the best long-term strategy for both companies.
It is no secret that Ladbrokes and Coral have been fierce rivals for some time now and it may have come as a shock to many people when they found out the two companies were considering a merger. The reasoning behind this move is sound though, as the companies hoped that merging would allow them to blunt the intensified competition from casino companies, who are considered to be the market leaders.
This move will make Ladbrokes Coral Plc. The single largest betting company in the United Kingdom, even though the deal will not include Gala Coral’s Bingo business, which is not included in the merger.
Both companies have recently revealed their first quarter earnings for 2016 and the performances of both Ladbrokes and Coral were satisfactory. It must also be noted that Coral showed a pre-tax loss of £50 million.
The companies believe the merger is the smartest move for the long-term, but are fully aware that once the two firms complete the merger, they could struggle a bit and growth will likely be hampered.
Coral’s CEO has said there are always hidden risks when you merge two companies but it is the job of the management teams to handle this. He also confirmed he will stay on for 12 months after the £2.3 billion deal has been completed to help the merger.
The merger may cause one of the sportsbook brands to be phased out, with all efforts then focused on the remaining brand. However, some gaming experts expect the company to maintain both brands, so we’ll just have to wait and see what happens.
The merger is currently being evaluated by the Competition and Markets Authority and a decision is expected to be reached later this month.
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