GVC and LCL reach terms on £4bn takeover
Agreed price contingent on FOBT stake restrictions, with the deal expected to be completed by Q2 2018
GVC has agreed a price with Ladbrokes Coral for its acquisition of the London-listed bookmaker.
The firms said this morning an offer has been accepted that would value LCL between £3.2bn and £4bn, based on restrictions to FOBT stakes.
Ladbrokes Coral shareholders will be entitled to 32.7p in cash, 0.141 ordinary GVC Shares and a contingent entitlement of up to a further 42.8p.
Following completion of the deal, Ladbrokes Coral shareholders will hold approximately 46.5% of the share capital, with GVC shareholders taking 53.5%.
“In a dynamically evolving industry, the transaction creates an Enlarged Group with the scale, diversity, proprietary technology and management expertise to pursue many opportunities globally,” said GVC CEO Kenny Alexander.
“GVC has a proven track record of creating shareholder value through the successful integration of acquired businesses and the GVC Board believe this transaction will create further value for our shareholders and those of Ladbrokes Coral.”
GVC said a combined group would realise cost synergies of at least £100m by 2021.
“In its relatively short time as a merged entity, Ladbrokes Coral has demonstrated why scale can be so effective in this market,” LCL chairman John Kelly said.
“The Ladbrokes Coral Board believes that the proposed combination with GVC accelerates our strategy to improve the customer experience, drive faster online growth and build a more diverse and extensive international portfolio of businesses.
“The acquisition has compelling strategic rationale allied to an opportunity to use the best of both from proven management teams and will create material shareholder value. It secures earlier delivery of our long-term value potential, which is why the Board of Ladbrokes Coral has unanimously recommended GVC’s offer.”
The two companies said the deal will be completed during late Q1 or early Q2 2018.