Ladbrokes has confirmed it is in talks to merge with Gala Coral as the two bookies adapt to the growth of online betting.
Ladbrokes operated 2,209 stores in the UK and Europe at the end of December 2014 but had made plans to close 60 stores over the course of 2015, according to its annual statement.
A merger with Gala Coral would add 1,845 UK licensed betting offices to the portfolio, 132 bingo halls and more than 800 stores in Italy.
The chain has been on an expansion drive over the past two years, adding a net 11 outlets over the course of 2014 by closing 13 unprofitable stores and purchasing 24. Ladbrokes, however, reduced its store numbers over the same period, cutting 89 from its portfolio in 2014.
The store closures cost Ladbrokes £74m but were part of the company’s drive towards improving its digital offer, according to the then chief executive Richard Glynn.
Digital betting grew by 23% during 2014 while UK retail betting grew by just 0.7%.
Gala’s UK retail store revenue growth was actually negative in 2014, with a 4% decline in sales. Online revenue increased by 12%.
The expanded business would create an online and retail business that covers betting shops, casinos and bingo halls across Sweden, Italy, Ireland and the UK.
Ladbrokes said that the proposals amounted to a reverse takeover and that the board had made no decisions on recommendations to shareholders.
