ladbrokes-gala-coral-deal-clearance-may-depend-on-shop-sales

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Ladbrokes-Gala Coral deal clearance might depend on store sales
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Bookmakers Ladbrokes and Gala Coral may have to shed numerous stores if their proposed merger is to go ahead, the dog has stated.
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the yohaig code Competition and Markets Authority stated a merger of the UK's 2nd and 3rd biggest bookmakers may restrict competitors on the High Street.

About 350 to 400 shops may have to be sold "for the merger to be conditionally cleared", the CMA said.

The CMA has given up until 13 June for responses to its provisionary findings.

Ladbrokes operates 2,154 wagering stores in Great Britain and 77 in Northern Ireland, while Gala Coral runs about 1,850 wagering stores in Great Britain.

The combined group would make it bigger than current market leader William Hill.

Martin Cave, who is chairing the CMA's query, said: "We have actually provisionally found that the merger between 2 of the biggest bookies in the country may be expected to lower competition and choice for clients in a large number of cities.
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"Although online wagering has actually grown significantly over the last few years, the evidence we've seen verifies that a large number of clients still pick to bet in shops - and numerous would continue to do so after the merger.
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"For these clients, competitors originates from the choice of stores in their city and it's they who could lose from any reduction of competition and choice."

The CMA said it was aiming to publish its final report by the end of July.

Ladbrokes said: "This is a substantial action and our focus now will be on concurring the shop disposals to satisfy the CMA." Ladbrokes shares had jumped 6.5% by the close of trade on Friday.

Gala Coral said it noted that the CMA was "provisionally minded to clear the proposed merger" and that it would continue to work with the yohaig code regulator on methods to achieve final clearance.
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Analysis: Frank Keogh, BBC Sport racing press reporter:

The face of Britain's betting shops has actually changed in the last twenty years - from smoky boltholes with horse racing dominating proceedings to glossy multi-screen sport outlets where fixed-odds betting terminals are a huge earner.

While critics say the casino-style makers have motivated problem bettors, the bookies firmly insist staff are trained to look out for issues.

The bottom line is the rise of the machines has actually assisted keep numerous of these shops open in a modern-day betting world where online betting has mushroomed.
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And while some shops look predestined to be casualties, this promotion code proposed ₤ 2.3 bn merger shows there is plenty of money still to be made in the British betting industry.

Analysts say the merged business will still have a dominant position even if numerous stores have actually to be offered.
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"We expect considerable cost conserving will be possible since there will be vast locations of overlap and unneeded duplication of functions across the combined company," stated Steve Clayton, head of equity research study at Hargreaves Lansdown.

Ladbrokes concurred the regards to a ₤ 2.3 bn all-share merger with Coral in July, and the company's investors backed the deal in November.

Ladbrokes profits struck by writedowns

11 August 2015
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