Operators asked for views on Lads-Coral merger
Competition and Markets Authority writes to industry to garner opinion on likely impact of proposed combination
The government department tasked with deciding whether the Ladbrokes and Gala Coral merger can go ahead has written to the operators’ UK rivals to seek their views on what impact the proposed combination could have on market.
As part of its phase two investigation into the deal, which recently commenced 25 working days ahead of schedule, the Competition and Markets Authority (CMA) must determine whether the merger would lead to a “significant lessening of competition”.
And to help it arrive at a decision, the CMA yesterday contacted executives at some of Ladbrokes’ and Gala Coral’s competitors and requested they complete a 15-part questionnaire by 29 January.
Among the questions, seen by eGaming Review, execs were asked whether the merger would have an impact on the quality of product offered by the enlarged firm, and whether a hike in prices would see retail customers transfer some or all of their business online.
The document also asked the execs to include details of their own firm’s operations, as well as figures for their online gambling and gaming yield for 2015.
Those contacted were reminded that they would be committing a criminal offence should they supply information proven to be false or misleading in a material way.
Speaking to eGaming Review, Ladbrokes’ director of media David Williams said the firm had expected the CMA to reach out to the market for feedback.
“It comes as no surprise and, whilst it is taking place, we will remain focused on delivering the organic growth plan at Ladbrokes,” he said.
Last week the CMA announced the merger investigation had been fast-tracked to phase two after it found evidence the deal “may lead to a worsening of their offer to customers” in areas where Coral and Ladbrokes’ shops were in close proximity.
A committee leading the investigation has been told it must come to a final decision on the merger by 29 June.
Should the merger be given the go-ahead, the CMA is expected to require Ladbrokes and Gala Coral to sell off anywhere between 250 – 1,000 shops, with the likes of Betfred and Paddy Power understood to be interested in purchasing a significant number.