The takeover of Ladbrokes Coral by GVC, the Isle of Man-based firm behind Foxy Bingo, could trigger up to 1,600 job losses, the companies said, as they published fresh details of a deal worth up to £3.9bn.
Online casino company GVC and bookmaker Ladbrokes said up to 6% of their combined 26,800 workforce – around 1,608 staff – could lose their jobs. Most would be in the UK but the cuts are not expected to affect staff until next year
The jobs likely to be affected are in areas including marketing, customer services and administrative functions. Ladbrokes’ network of high street bookmakers is not likely to be affected.
Ladbrokes Coral’s head office in central London is likely to close, with some of those roles moving to GVC’s head office, also in the capital.
The forecast of job cuts came as the two companies outlined the terms of a tie-up worth up to £3.9bn and Ladbrokes handed its shareholders a surprise dividend payout worth £78m.
The eventual price tag of the deal to create the UK’s largest public betting firm depends on the government’s review of the maximum permitted stake on fixed-odds betting terminals (FOBTs).
GVC’s offer is worth up to £3.9bn, but could fall by £800m if the government opts to slash the maximum permitted FOBT stake to £2. This is because the machines bring in more than half of bookmakers’ revenues and GVC does not want to pay the top price if a big chunk of Ladbrokes’ income could disappear.
More takeovers among gaming firms could follow, with William Hill, online casino 888 and Mecca Bingo firm Rank all potential merger or acquisition candidates.
Ladbrokes also posted an update of its recent trading, revealing that revenues rose 12% in the final quarter of the year after a string of unexpected football results.
