Lads late to the game
Aussie betting giant Tabcorp, the country’s leading online wagering firm, has rejected a proposed merger with the U.K.’s third-largest wagering operator, Ladbrokes, according to reports.
The Sydney Morning Herald reports that Ladbrokes was late to the booming Australian market, and hoped to make up for lost time by consolidating with a dominant operator. The deal would have created Australia’s largest bookmaking firm.
In recent years, Australia has become one of the most profitable gaming markets in the world. According to information recently published by the government, in 2015 Aussie gamblers were on course to lose AU$1,000 for every man, woman and child in the country. From September 2014 to September 2015, Australians gambled away AU$24.1 billion (US$17.38 billion) on all forms of wagers, a 6 percent year-on-year increase.
In 2011, Ladbrokes first dipped its toe in the jurisdiction, spending $22.5 million to buy Brisbane-based Gaming Investments, whose website Bookmaker.com.au had less than 15,000 customers. In 2013, SMH reported, Ladbrokes switched gears, and tried to win market share with customers who set up multiple accounts. In the same year, Ladbrokes also made its initial pitch to Tabcorp.
Back in the U.K., Ladbrokes is merging with Gala Coral, a deal that will create a £2.3 billion (US$4.8 billion) combined business with the nation’s largest chain of betting shops, according to Intergameonline.com.
Meanwhile, in an effort to fend off competition from gatecrashers Paddy Power, Ladbrokes, William Hill and Bet365, all relatively new to the Australian market, Tabcorp planned to merge with rival Tatts Group. That plan was shelved last November, but may be revived this year. That combined business would have been worth an estimated AU$9 billion and would have generated annual revenues of AU$100 million.
In the ongoing wave of industry consolidation, Irish bookie Paddy Power, which owns Sportsbet in Australia, just got the go-ahead to merge with rival Betfair, creating a £5 billion market leader.
