07.12.2017

Zugemailt von / gefunden bei: GVC (BSN-Hinweis: Lauftext im Original des Aussenders, Titel (immer) und Bebilderung (oft) durch boerse-social.com aus dem Fotoarchiv von photaq.com)

The board of Ladbrokes Coral and the board of GVC (the "Boards") announce that they are in detailed discussions regarding the possible combination of the two businesses, following the receipt by Ladbrokes Coral of a non-binding proposal from GVC regarding a possible offer for the entire issued and to be issued share capital of Ladbrokes Coral (the "Possible Offer").

It is expected that the Possible Offer would be structured as a scheme of arrangement pursuant to which GVC would acquire the entire issued and to be issued ordinary share capital of Ladbrokes Coral. Under the terms of the Possible Offer, Ladbrokes Coral shareholders would be entitled to 32.7p in cash and 0.141 ordinary GVC shares for each Ladbrokes Coral share, and a potential further value of up to 42.8p structured as a contingent value right ("CVR"). The value of the CVR, which would be satisfied by the issue of loan notes by GVC (the "Loan Notes"), would be determined by reference to the outcome of the Department of Digital, Culture, Media and Sport's current 'Review of Gaming Machines and Social Responsibility Measures' (the "Triennial Review") relating to the regulation of Category B2 Fixed-Odds Betting Terminals ("FOBTs") and its estimated impact on the run-rate profitability of Ladbrokes Coral's UK business, after giving effect to any mitigations. A summary of the proposed CVR mechanism is set out in Appendix I.

Based on the respective Ladbrokes Coral and GVC share prices as at the close of business on 6 December 2017, the Possible Offer values Ladbrokes Coral at 160.9p per Ladbrokes Coral share, equating to a total equity value of c.£3.1 billion, plus a CVR of up to 42.8p per Ladbrokes Coral share, equating to a total equity value of up to c.£3.9 billion (including the maximum CVR). It is expected that the Proposed Offer would include a mix and match facility allowing Ladbrokes Coral shareholders the opportunity to elect to receive more cash or more new ordinary shares in GVC, subject to offsetting elections made by other Ladbrokes Coral shareholders, as the case may be. The CVR would not be included in the mix and match facility. 

Based on the terms laid out above, the parties anticipate that Ladbrokes Coral shareholders would hold c.46.5 per cent, and GVC shareholders would hold c.53.5 per cent of the issued and to be issued share capital of the enlarged group.

Whilst the determination of the senior management positions will be finalised by the parties over the coming weeks, it has been agreed by the parties that Kenneth Alexander would be the CEO of the enlarged group should the transaction proceed to completion.

The Boards believe that a transaction has the potential to create material shareholder value and that there is a compelling strategic rationale for the Possible Offer. The enlarged group would be an online-led globally positioned betting and gaming business that would benefit from a multi-brand, multi-channel strategy applied across some of the strongest brands in the sector. The enlarged group would be geographically diversified with a large portfolio of businesses across both regulated and developing markets, with the scale and resources to address the dynamics of a rapidly changing global industry. Any transaction would also enhance the enlarged group's position in a number of the world's largest regulated online gaming markets, including the UK, Italy and Australia, and would significantly increase GVC's current share of revenues from locally regulated/taxed markets to more than 90 per cent. The enlarged group would have strong growth prospects with momentum in its online businesses, potential for material synergies including the use of leading proprietary technology, and the opportunity to select the best of both people and operations.

The Board of GVC expects that the Possible Offer would result in material synergies which will create value for both sets of shareholders, which the Board of GVC would quantify in any announcement of a firm intention to make an offer for Ladbrokes Coral under Rule 2.7 of the City Code on Takeovers and Mergers (the "Code").

The Board of GVC also believes that the transaction will be double digit EPS accretive from the first full year post-completion and following all reasonably expected outcomes of the Triennial Review, including the FOBT maximum stake being set at £2.00. The Board of GVC believes that the enlarged group leverage will not exceed 3.0x Net Debt/EBITDA (where Net Debt is interest bearing loans and borrowings and customer liabilities, less cash and cash equivalents, and EBITDA is 'clean EBITDA') by the end of the first full financial year post-completion, following all reasonably expected outcomes of the Triennial Review.

A formal announcement of an offer under Rule 2.7 of the Code remains conditional on, inter alia, agreement on the other terms and conditions of the Possible Offer, satisfactory completion of customary due diligence and final approval by the Boards. The parties reserve the right to waive any or all of these pre-conditions.

GVC reserves the right with the agreement or recommendation of the Board of Ladbrokes Coral to a) vary the form and/or mix of consideration and/or b) make an offer at any time on less favourable terms. The parties reserve the right to adjust the terms of the Possible Offer to take account of the value of any dividend or other distribution which is announced, declared, made or paid by either party after the date of this announcement to the extent that such dividends are outside the ordinary course of business of, or inconsistent with the stated dividend policy of, Ladbrokes Coral or GVC, as the case may be.

This announcement does not amount to a firm intention to make an offer under Rule 2.7 of the Code and accordingly there can be no certainty that any transaction will occur, even if the pre-conditions are satisfied or waived. Any transaction would be subject to any requisite regulatory approvals, GVC shareholder approval and Ladbrokes Coral shareholders' acceptance or approval, as well as other customary conditions.

In accordance with Rule 2.6(a) of the Code, GVC is required, by not later than 5.00 pm (London time) on 4 January 2018, either to announce a firm intention to make an offer for Ladbrokes Coral in accordance with Rule 2.7 of the Code or to announce that it does not intend to make an offer, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. This deadline can be extended with the consent of the Panel on Takeovers and Mergers in accordance with Rule 2.6(c) of the Code.

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GVC Holdings

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