Dermot Desmond’s “influence” appeal to block the merger of Ladbrokes and GalaCoral has been rejected by a UK Takeover Panel.
Desmond, who owns 2.8 percent of Ladbrokes Plc shareholdings, had appealed to the Takeover Panel focusing on an agreement which would make Playtech the new company’s main software provider.
According to SBC News, when the merger was announced, Playtech owned 9.7 percent of Ladbrokes shares and was awarded a £75 million provisions contract, consisting of £40 million in company shares and a further £35 million in cash attached to corporate targets achieved by the merged enterprise.
Desmond publicly criticized Playtech’s influence on the merger at a shareholders meeting where he asked voters to deny the deal.
“It is clear that Ladbrokes has failed to adequately disclose the basis for the extraordinary payment to Playtech. It was only in response to our requests that the Playtech amendment agreements were belatedly published on the company website,” he said.
Voters approved the deal, however, and Desmond then filed his appeal.
The Takeover Panel concluded that regardless of information disclosed Playtech’s £75 million contract would have had little influence on Ladbrokes shareholders decision to approve the merger. It also concluded that the agreement was through the regular course of business, meaning that the necessary disclosures were made at the time, SBC reported.