Bid by UK online and land gambling group may complicate Tabcorp-TATTS merger
The newly merged Ladbrokes Coral online and land gambling group may be about to put the cat squarely among the Australian pigeons, according to reports in the Mail of Sunday, which claims that the UK corporate is planning to make an "audacious" bid for Aussie gambling giant Tabcorp.
InfoPowa readers will recall that Tabcorp is in the midst of merger negotiations with fellow Australian gambling giant Tatts Group, and the British bid could create a serious disruption.
The Mail on Sunday report, on which Ladbrokes Coral has declined to comment, reveals that a multi-billion pound sterling bid is being guided by advisers appointed within the past few weeks to work on the project, which has the potential to create one of the world's largest gambling groups with a valuation north of GBP 5 billion.
A successful Ladbrokes Coral bid would enable the GBP 2.4 billion UK giant to continue expanding with the acquisition of Tabcorp, valued conservatively at around GBP 2.3 billion and one of the top companies on the Australian Stock Exchange.
Tabcorp is currently busy bringing together its own merger offer on rival Tatts Group, which would create a GBP 6.7 billion (A$11.3 billion) Australian gambling giant with revenues of A$5 billion.
The Mail on Sunday's sources say that Ladbrokes Coral is not interested in including Tatts in any acquisition bid, and is instead planning to "crash the deal with its offer for Tabcorp."
The bid is likely to be made up of a mixture of cash and shares, and is not the first time that Ladbrokes has eyed Tabcorp. The UK corporate approached Tabcorp in 2013 to negotiate a merger, but was rebuffed by Tabcorp chief executive David Attenborough (see previous InfoPowa reports).
Consolidation is an attractive option as international regulatory, operating costs and taxes tighten the pressure on profits. This year has seen several major mergers of UK gambling groups; Irish bookmaker Paddy Power merged with online gaming operator Betfair in February, while Sportingbet owner GVC beat rival 888.com to acquire Bwin.party earlier this year.
William Hill, whose merger talks with PokerStars owner Amaya collapsed last month, successfully fought off a bid from Rank and 888, although industry insiders claim that Rank is set to make another run at William Hill next year.
Despite increasing regulatory pressure by state and federal governments in Australia, it remains an enthusiastic and attractive market; Aussies spend more on betting per capita at A$1,200 each annually than any other nation, and although online gambling has been banned there it presents many other gambling opportunities to companies.
Online Casino News Courtesy of Infopowa