Ladbrokes expands sports betting services with bolt-on acquisition

High Street betting shop Ladbrokes is to get its hands on the Betdaq exchange business through its acquisition of Global Betting Exchange Alderney (GBEA).

Ladbrokes is paying TBH Limited €30m on a cash-free/debt-free basis for GBEA and will also exchange €4.0m for a 10% stake in TBH Guernsey (TBHG), the technology provider to GBEA. In addition, it also has a call option to take over TBHG after four years.

The group said that the transaction combines Ladbrokes' global brand and improved sportsbook with a "high quality, scalable betting exchange to create the most comprehensive sports betting service in the market".

Try 6 free issues of MoneyWeek today

Get unparalleled financial insight, analysis and expert opinion you can profit from.

Start your trial

Sign up for MoneyWeek’s free twice-daily newsletter.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Sign up

Meanwhile, it accelerates the firm's strategy to grow digital revenues through technology investment.

"The Betdaq exchange is a well-regarded and well invested business and a close strategic fit for Ladbrokes," said Chief Executive Richard Glynn.

"Whilst the main focus of our digital growth strategy continues to progress well, this bolt on acquisition provides us with an exciting opportunity to grow our share of wallet through the creation of a differentiated and comprehensive sports betting proposition for customers and also supports our drive for improved liability management."

The firm said that the transaction would be earnings accretive this year.

Shares were up 2.51% at 204.4p in early trading on Thursday.

BC