GVC has received stockholder approval to acquire UK bookmaker Ladbrokes for an initial £3.2 billion.
The price could rise depending on where the UK government sets maximum stakes for fixed odds betting terminals. The government is considering slashing the maximum bet on the terminals to £2 pounds from £100, a move which is expected to seriously impact revenues for high street bookmakers.
GVC, however, structured a contingent variable rate—effectively a sliding scale of how much GVC would pay the government’s final decision.
GVC will now pay roughly £3.2 billion in cash and shares after receiving 99.9pc backing from its shareholders for the purchase, according to SBC News. It will pay nothing more if FOBT stakes are cut to £2, but the total deal value could rise to £4 billion if the government only reduces stakes to £50.
The deal is expected to be completed later this month.
At the start of 2018, GVC has topped €1bn in sales for the first time, helped by a string of bookmaker-friendly sporting results, which saw the industry keep a larger proportion of stakes than gamblers won, the report said.
Publishing its audited full-year 2017 results, GVC reported a 17 percent increase in group net gaming revenues of €925 million. The firm reports a clean 2017 EBITDA of €239 million and group-adjusted profits of €178 million, up 182 percent on 2016’s €58 million.
