Coral CEO Leaver: Demands are “draconian”
The British Horseracing Authority has rejected an offer by Gala Coral that would give the sport a flat 7.5 percent of online and retail racing profits. In October, Gala offered 10.75 percent of betting shop profits and 5 percent of online profits.
According to SBC News, the lower counteroffer took place after the horse industry introduced its Authorized Betting Partner Scheme, which requires online bookmakers to pay “a fair price” to horseracing or forfeit the right to sponsor the sport. The horseracing industry has yet to determine that fair price, however.
Bookmakers call the latest tactic nothing more than a cash grab. Ever since 2010, bookies have seen the cost of media rights rise; presently, betting shops are required to pay 10.75 percent on their British Horseracing business to the sport, though online revenues are exempt.
In an open letter to the Racing Post, Coral CEO Carl Leaver said the company would “happily” pay 7.5 percent of its total profits from betting on racing; any more, he said, would be unfair due to the higher cost of taking bets on racing. For Coral, he said, since 2009 that cost has risen from £33 million (US$48.6 million) to £48 million (US$68 million) in seven years. He called the new demands “draconian.”
Nick Rust, CEO of the British Horseracing Authority, disagrees. “Far from being draconian, ABP is a voluntary policy, and we hope that all betting operators who see value in British racing agree to come on board,” Rust said. “Racing’s door remains wide open to everyone who wishes to come and talk to us directly. We remain firmly of the view that this issue will be best resolved through private rather than public discussion.”
A spokesman for Ladbrokes, another U.K. bookie which is soon to merge with Coral, weighed in on the dispute, saying, “We believe the Coral letter presents the arguments very neatly and reiterates some of the points we have been making in recent weeks. It highlights how costs have escalated and recognizes the commercial reality of today rather than the perceived injustices of the past.”
