Ladbrokes and GVC renew talks on $5.2 billion merger

Thursday 7th of December 2017

GVC is in detailed talks for a GBP3.9 billion ($5.23 billion) acquisition of Ladbrokes Coral, the two companies said in an announcement to the London Stock Exchange.

The deal would be structured as a scheme of arrangement under which GVC would buy all of the outstanding shares of Ladbrokes. Shareholders would receive 32.7 pence in cash and 0.141 GVC share for each Ladbroke share. There is potential for a further 42.8 pence contingent value right (CVR).

The offer values Ladbrokes at a total equity value of GBP3.1 billion, rising to GBP3.9 billion including the CVR.

The two parties anticipate that Ladbrokes Coral shareholders would hold 46.5 percent, and GVC shareholders would hold 53.5 percent of the enlarged group.
Kenneth Alexander would be the CEO of the enlarged group should the transaction proceed to completion.
“The boards believe that a transaction has the potential to create material shareholder value and that there is a compelling strategic rationale for the possible offer,” the statement said. “The enlarged group would be an online-led globally positioned betting and gaming business that would benefit from a multi-brand, multi-channel strategy applied across some of the strongest brands in the sector.”

Any transaction would also enhance the enlarged group's position in a number of the world's largest regulated online gaming markets, including the UK, Italy and Australia, it added.
GVC said its board also believes that the transaction will be double digit EPS accretive from the first full year post-completion and following all reasonably expected outcomes of the Triennial Review, including the FOBT maximum stake being set at GBP2.00.