Ladbrokes in merger talks with Gala Coral Group

Bookmaker Ladbrokes has stated it remains in talks with the board of Gala Coral Group over a possible merger.

A deal would produce the UK's biggest bookie with nearly 4,000 High Street shops.

The discussions issue integrating Ladbrokes with Coral Retail, Eurobet Retail and Gala Coral's online companies.

Ladbrokes said there was no certainty that the talks would lead to a deal, and possible terms and timings were also yet to be concurred.

Shares in Ladbrokes rose more than 11% after the announcement.

"A merger with Gala Coral could produce a combined company with significant scale and has the possible to generate significant expense synergies, developing value for both business' investors," president Jim Mullen stated.

If the deal proceeds, it would see the merged group overtake William Hill as the biggest UK bookie, bringing together around 2,100 stores from Ladbrokes and 1,845 from Coral.

The merger talks do not include Gala's 132-strong bingo service.

Mr Mullen included that the company's board has yet to choose whether a deal would be "strategically appealing" and whether it could be "provided to investors on suitable terms."

The company stated that the deal, if completed, might be categorized as a reverse takeover of Ladbrokes.

Ladbrokes formerly tried to purchase Coral in 1998, however its scheduled takeover was blocked by the government.

The then Trade and Industry Secretary Peter Mandelson stated a merger would cause "a weakening of cost competitors at the nationwide level" and a reduction in consumer option.

Earlier this promotion code year, Ladbrokes reported a large fall in pre-tax earnings for 2014, from ₤ 68m to ₤ 38m, and stated that it anticipated to close 60 UK shops this promotion code year.

Those strategies would be untouched by any deal with Coral Group.

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