Wednesday November 25,2015 : LADBROKES INVESTOR VOWS TO DERAIL MERGER (Update)
Furious over shareholder approval.
According to the Daily Mail Ladbrokes investor Dermot Desmond is furious that shareholders backed the company’s proposed GBP 2.3 billion merger with Gala Coral saying, “This is only the first of 15 rounds, or ten rounds or even seven rounds. There’s a long way to go.”
In addressing the shareholder meeting Tuesday Desmond laid out his opposition to the deal saying: “I believe there is widespread acceptance that the Ladbrokes board and management are not good enough and that performance over the past five years has been abysmal.”
“Total profit before tax has declined almost 40 percent in that period. Had it not been for a GBP 90 million increase in contribution from fixed-odds betting terminals, profits would have nearly been wiped out entirely.
“Shareholders won’t need me to remind them of the decline in the Ladbrokes share price, nor the fact that peers William Hill, Betfair and Paddy Power are 91 percent, 100 percent and 300 percent respectively ahead over that same period.
“Simply put, the board and the management team have not earned the right to be entrusted with the negotiation and completion of this deal,” he said. “In my opinion, in the end this could be a deal too far for Ladbrokes shareholders.”
The Irish billionaire who owns a 2.8 percent stake in Ladbrokes has intimated he may convene another shareholder meeting with a view to derailing the merger.
According to the Daily Mail, Desmond has been in contact with the Takeover Panel over “concerns the bookie was not transparent about some details connected to the deal”.
The proposed merger would still need to be scrutinised by the UK Competition and Markets Authority.