24th Jul 2015 06:44
LONDON (Alliance News) - Ladbrokes PLC and Gala Coral Group Ltd on Friday said they have agreed to merge to create a gambling company with a market capitalisation of around GBP2.1 billion.
Under the terms of the deal, FTSE 250-listed Ladbrokes will issue new shares to Gala Coral shareholders representing 48.25% of the enlarged group, with Ladbrokes shareholders to own the other 51.75% of the business. Ladbrokes said it will launch a share placing, issuing 92.4 million shares, 9.99% of its existing total, via an accelerated bookbuild run by UBS and Deutsche Bank in order to strengthen the balance sheet of the new business.
The new company will be called Ladbrokes Coral PLC and will be headed by Ladbrokes Chief Executive Jim Mullen.
The news came as Ladbrokes outlined the outcome of its long-awaited strategy review, which will see the company look to increase footfall in its UK retail business and boost its multi-channel sales by expanding its digital operations. As a result of the changes, Ladbrokes said its 2015 operating profit will be around GBP20 million lower than its previous expectations.
In a separate announcement, FTSE 250-listed gaming technology company Playtech PLC said it has struck a deal with Ladbrokes on an early determination on the funds it is owed under its marketing services agreement with the bookmaker.
Playtech will receive GBP75 million following the Ladbrokes-Coral merger, with GBP40 million of this to be satisfied in Ladbrokes shares and GBP35 million to be paid in cash.
By Sam Unsted; [email protected]; @SamUAtAlliance
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