Paddy Power and BetFair Agree Huge Merger
Updated: 26th August 2015
The two betting companies Paddy Power and BetFair are set to merge their respective businesses to create the largest online gambling operation in the world.
An all-stock merger has been agreed with Paddy Power shareholders to control 52 per cent of the new business and BetFair shareholders to take ownership of the remaining 48 per cent.
Consolidation through mergers has been on the agenda across the online gambling industry in recent months, with the two betting companies Ladbrokes and Coral having announced a merger deal of their own in July.
There have also been reports of a potential acquisition of the gambling firm Bwin.party by the betting groups 888 or GVC.
The combined Ladbrokes and Coral businesses are valued at £2.3 billion but the combination of Paddy Power and BetFair is set to create a giant of the industry with an overall value of more than £6.5 billion.
“These are two businesses that are performing at a very high calibre and we will have a market-leading position in the UK, Europe, Ireland and Australia,” said Breon Corcoran, who is to head up the merged operation having left Paddy Power to join BetFair in 2012.
The combined businesses are to trade as Paddy Power BetFair Plc, with Paddy Power’s current chief executive Andy McCue to become its chief operating officer and Paddy Power’s chairman Gary McGann to occupy the same role at the merged group.
“BetFair is the leading exchange business in sport betting and that technology is something Paddy Power does not have,” Corcoran said in explaining the rationale behind the merger.
“We have a retail and mass market business and we have an Australian business that they do not have,” he added.
BetFair announced on Wednesday that its first quarter revenues were up 15 per cent to £135.4 million, with its pre-tax profits for the most recent full-year period having increased by 55 per cent to reach £476.5 million.
Paddy Power has been growing revenues and profits in recent quarters too, with its interim operating profit in the six months to the end of June representing a 33 per cent improvement on the same period of the previous year.
Emma qualified as a Chartered Accountant in 2002. Since then, she has specialised in corporate finance, joining BTG-McInnes in July 2006. She has extensive experience in advising the SME market on fundraising, re-financing, acquisitions and disposals, across a broad range of industries.