Gala, the gaming group, today announces the acquisition of Gala Coral, the bookmaker and internet gaming operator, for a consideration of £2.18bn. The deal creates Europe’s pre-eminent integrated betting and gaming company with strong market positions in licensed betting offices, bingo and casinos, and a high quality multimedia offer.
The enlarged company has an enterprise value of more than £4bn. It trades from 1,450 outlets, employs a total workforce of 17,000 and has more than 2.2 million active customers.
The deal is backed by Candover, Cinven and Permira, which are the joint and equal private equity owners of Gala. Each is increasing its investment in the enlarged company by £275m to help finance the acquisition. Debt has been provided by Royal Bank of Scotland, Lehman Brothers and Intermediate Capital Group.
Gala chief executive, Neil Goulden, and chairman, John Kelly, will carry on in the same posts in the enlarged company. Vaughn Ashdown and Mick Mariscotti, chief executive and CFO respectively of Coral, have agreed to stay on at the enlarged group and will join the Gala Group board to help facilitate the integration of the two companies.
Following the acquisition, the enlarged group will be the UK’s third largest bookmaker with 1,267 licensed betting offices, the UK's largest bingo operator with 167 clubs and a leading operator of casinos with 30 outlets. Gala Coral’s established online business, matched with Gala’s web based products, will also make Gala a significant online gaming operator with strong prospects for further growth.
Commenting on the deal, Neil Goulden, Gala chief executive, said:
"Gala Coral is an ideal fit with Gala. It is a superbly run company, with strength and depth in management. It fits into our high volume low-ticket strategy and allows us to move into licensed betting offices for the first time. We have a demonstrable track record of successfully integrating businesses, and there are significant revenue enhancing synergy opportunities in combining the two companies.
“This is the perfect time to merge Gala and Gala Coral as both companies seek to take maximum advantage of the deregulating gaming market. The merger will add enormous benefit not just to our shareholders but also to our 17,000 employees and 2.2m customers. Vaughn Ashdown is one of the best operators in the industry and I am looking forward to working with him”.
Vaughn Ashdown, chief executive of Gala Coral, said:
"The combination of two of Britain’s top private equity backed businesses has been three years in the planning and I am personally delighted to have achieved the best consolidation opportunity in our industry. It will allow the Gala Coral and Gala brands to thrive and grow together. I have the highest regard for Neil and his team, as well as my own management team, and I will help them wherever I can to ensure the new Group’s success."
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