William Hill plc has filed a complaint over the planned 2.3 billion pound merger between bookmaking groups Ladbrokes and Coral warning the enlarged company poses a threat to the UK gambling market.
According to Britain’s The Telegraph newspaper, the complaint charges that the merger will harm competition in the industry, even if Ladbrokes and Coral agree to sell off significant numbers of betting shops.
The complaint was made to the UK Competition and Markets Authority. William Hill recommended that Ladbrokes and Coral be barred from merging on the same grounds that they were blocked from merging in 1998, when a merger attempt was blocked by UK government on the grounds that it would hurt competition in the market.
“It is important to recognize that the structure of the market has changed relatively little since 1998,” the complaint said. “To the extent that the market has changed, those changes reinforce the concerns set out in 1998.
William Hill also contended that the market is already significantly more concentrated than it was before.
The Competition and Markets Authority is investigating the merger proposed by the two gambling companies. If the merger goes ahead Ladbrokes-Coral will unseat William Hill as the biggest bookmaking firm in the UK.
Analysts expect the authority will require Ladbrokes-Coral to sell part of its combined estate portfolio, including up to 500 retail shops.
Ladbrokes-Coral argues that internet gambling—which was not a factor in their previous merger attempt in 1998—has transformed the industry and creates room for the merger.
