Ladbrokes Coral to learn merger fate by June
Competition and Markets Authority fast-tracks investigation with decision on merger due on or before 24 June
Ladbrokes and Gala Coral will learn whether their proposed merger can go ahead before the end of June after the Competition and Markets Authority (CMA) today said it was fast-tracking its investigation into the deal.
The combination, which if given regulatory approval will create the largest high street bookmaker in the UK, had entered phase one of the CMA investigation on 16 December.
The statutory period for phase one is 40 working days, however, following a request made by both Ladbrokes and Gala Coral to speed-up the process, the CMA today said the investigation had today entered phase two, approximately 25 working days ahead of schedule.
The CMA said it was able to fast-track the process due to its investigation having already found evidence the merger “may lead to a worsening of their offer to customers” in areas where Coral and Ladbrokes’ shops are in close proximity.
“As the second and third largest bookmakers in the country in terms of betting shops, the merger could affect competition in the very large number of areas where their shops overlap,” Andrea Coscelli, CMA executive director of markets and mergers and decision-maker in this case, said.
“As such it warrants an in-depth investigation so we can look in detail at these and other potential competition concerns.
“The fast-track request means that the inquiry group can now get started with that investigation,” he added.
The phase two investigation will be overseen by a group of independent panel members supported by a case team of CMA staff. The group has been told it must publish its final decision by 24 June 2016.
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 some or all of the estate.
Ladbrokes and Gala Coral announced they had agreed terms on a merger in July, at which point it was also revealed that Ladbrokes CEO Jim Mullen would head-up the enlarged firm.
“This fast track is in line with our expectations and aligns to our original view regarding the timescales for the process when we announced the merger in July last year,” David Williams, Ladbrokes director of media, said.
The CMA is an independent non-ministerial government department with responsibility for carrying out investigations into mergers, markets and the regulated industries and enforcing competition and consumer law.