The proposed takeover of British bookmaker Ladbrokes Coral by Isle of Man-headquartered GVC Holdings could result in more than 1,600 employees of the combined entity losing their jobs, the two companies revealed in a new round of details about the deal.
Ladbrokes and GVC explained that around 6% of their combined workforce of 26,800 could be laid off after the takeover is finalized. The job cuts are likely to affect employees sometime next year. The two companies also said that mostly UK jobs will be cut.
GVC Holdings, which currently operates popular online gambling brands such as bwin, partypoker, and Foxy Bingo, employs around 1,600 people on the Isle of Man and at its London office. As for Ladbrokes Coral, which was formed back in 2016 through a merger between Ladbrokes and Coral, is employer to over 25,000 people.
GVC and Ladbrokes said on Friday that the jobs affected will include areas like customer services, marketing, and administrative functions. The deal is not expected to affect Ladbrokes’ chain of over 3,500 high street betting shops. However, the company will likely have to close its head office in London, with some of the roles being relocated to GVC’s office in the capital.
Following comprehensive discussions, Ladbrokes agreed in December to be acquired by its online counterpart in a deal that could value the major British bookmaker at between £3.2 billion and £4 billion. The final purchase price will be determined once the UK Government announces the outcome of its review into the highly controversial high street betting machines known as fixed-odds betting terminals.
Maximum bets accepted by these could be reduced to just £2 by the Government. In case of such a massive cut, Ladbrokes’ price could go down to £3.2 billion. The company currently operates the largest number of FOBTs in the UK, and a crackdown of such proportions would hit its income significantly.
UK Competition and Markets Authority Review
The UK Competition and Markets Authority announced earlier this week that it would evaluate the competition impact of the proposed takeover. The markets watchdog would be accepting comments on the deal through February 21 and is expected to announce its decision on whether Ladbrokes and GVC should proceed with their consolidation in early April. The deal is expected to be completed during the first half of the year.
A review by the CMA is a standard procedure in deals of this scale, but can be quite lengthy sometimes. Back in 2016, Ladbrokes and Coral were subjected to such a review back in 2016 and had to sell part of their betting shops in order to prevent clustering of facilities run by the same owner in areas across the UK.
When completed, the takeover of Ladbrokes by GVC would create UK’s largest gambling operator with retail presence across the nation and online presence across multiple regulated jurisdictions.
Source: European Gaming News