Ladbrokes in talks to acquire Betdaq
By Christopher Thompson
Ladbrokes has confirmed it is in talks to buy Betdaq, the lossmaking betting exchange controlled by the Irish business tycoon Dermot Desmond.
The bookies, whose plans to expand its online gambling business have been beset by delays, said negotiations were ongoing although there was “no certainty” that an agreement would be reached.
Ladbrokes did not disclose a price although a person familiar with discussions said a figure of about £30m had been discussed.
Simon French, an analyst at Panmure Gordon, said a deal with Betdaq would help Ladbrokes broaden its offering beyond fixed-odds betting.
“A betting exchange gives Ladbrokes a point of differentiation from William Hill and could attract customers from [market leader] Betfair,” he said.
“But it’s no substitute for reinvigorating their online business.”
Ladbrokes, which already uses Betdaq technology for pricing and hedging its customers’ bets, said the potential acquisition would not cannibalise its existing betting business.
“We know a proportion of our customers use betting exchanges as well as bookmakers so it would be complementary – these services can sit side by side,” Ladbrokes said.
Global Betting Exchange, which trades as Betdaq, was set up by Mr Desmond 13 years ago in Dublin as a rival to London-based Betfair.
Mr Desmond owns nearly 2 per cent of Ladbrokes stock, according to the company.
The announcement comes after failed acquisition talks with 888 Holdings and Sportingbet – the latter coveted by rival William Hill – since chief executive Richard Glynn was appointed nearly three years ago.
Since then Mr Glynn has said he would focus on growing the business organically.
Last July, Ladbrokes fired Richard Ames, who had run the company’s online division and been a board member since 2009. The dismissal happened in the wake of a profit warning caused in part by technological problems at Ladbrokes’ online division.
Mr Glynn has made boosting the company’s online business a centrepiece of his tenure, in an attempt to compete with peers such as William Hill Online, the rival bookmaker’s joint venture with Playtech.
Ladbrokes shares remained unchanged in London on Monday at 202.2p.