Gala Coral may need to sell shops to clear Ladbrokes merger

Nottingham-headquartered Gala Coral may have to sell some of its betting shops if its merger with Ladbrokes is to go ahead.

The Competition and Markets Authority (CMA) has provisionally found that the merger between the gambling giants may give rise to competition concerns in a large number of local areas.

The CMA says that around 350 to 400 shops may have to be sold for the merger to be conditionally cleared.

Ladbrokes Gala Coral are, respectively, the second and third largest bookmakers in the UK by number of shops. They also provide betting and gaming products online, ‘on-course’ at certain racecourses, and by telephone – as well as each operating two greyhound tracks.

Ladbrokes operates 2,154 betting shops in Great Britain and 77 in Northern Ireland and Coral operates around 1,850 betting shops in Great Britain.

Martin Cave, inquiry chair, said: “We’ve provisionally found that the merger between 2 of the largest bookmakers in the country may be expected to reduce competition and choice for customers in a large number of local areas. Although online betting has grown substantially in recent years, the evidence we’ve seen confirms that a large number of customers still choose to bet in shops – and many would continue to do so after the merger.

“For these customers, competition comes from the choice of shops in their local area and it’s they who could lose out from any reduction of competition and choice. Discounts and offers of free bets to individual customers are ways betting shops respond to local competition which could be threatened by the merger. We’re also concerned that such a widespread potential reduction in competition at the local level could worsen those elements that are set nationally such as odds and betting limits.

“We’ll now consider responses to our provisional findings before coming to a final decision. If our provisional findings are confirmed and divestiture would be a suitable remedy, Ladbrokes/Coral may have to sell a large number of shops to a suitable purchaser or purchasers in order to preserve competition in those local areas. We’ll need to look closely at the exact number of shops and areas that would be involved – the overall size and complexity may mean that the sales need to be substantially completed before the merger can go ahead.”