Ladbrokes defends Gala Coral merger after Desmond attack

Bookmaker Ladbrokes has put out a statement calling on its investors to support its £2bn proposed merger with Gala Coral after Irish billionaire Dermot Desmond, who owns a near 3% stake in the group, slammed the deal on Wednesday.

Ladbrokes’ directors reiterated their recommendation to shareholders to vote in favour of the deal at the general meeting on 24 November.

“The board remains confident that shareholders will see the attraction of the proposed merger and continues to work towards a successful conclusion to the proposed transaction,” it said.

Desmond, who is sometimes described as Ireland’s answer to Warren Buffett, said on Wednesday that the proposed merger with Gala was a “wrong deal”.

“The real winners are the Coral shareholders, who receive access to liquidity for their shares and significant relief from a £2.2bn debt burden," he said.

“Make no mistake, this is a zero-premium acquisition of Ladbrokes by Coral.”

In addition, he pointed out that since the announcement on 24 July, the shares have dropped to 109p from 130p, in contrast with Paddy Power and Beftair, whose share have risen 35% and 20% respectively since their merger was announced.

At 0955 GMT, Ladbrokes shares were 0.4% higher at 109.90p.