Ladbrokes

Ladbrokes plc
Public
Traded as LSE: LAD
Industry Gambling
Founded 1886
Headquarters

Imperial House, Imperial Drive, Rayners Lane, Harrow, Greater London

HA2 7JW
Key people
 John Kelly, Chairman
Jim Mullen, CEO
Ian Bull, CFO
Products Sports betting, financial betting, poker, casino, games, Bingo and backgammon
Revenue £1,174.6 million (2014)[1]
£139.6 million (2014)[1]
£41.0 million (2014)[1]
Number of employees
 13,000 (2014)[2]
Slogan The world's leading sports betting and gaming company.
Website www.ladbrokesplc.com

Ladbrokes plc /ˈlædbrʊkz/ is a British-based betting and gambling company. It is based in Rayners Lane in Harrow, London. From 14 May 1999 to 23 February 2006, when it owned the Hilton hotel brand outside the United States, it was known as Hilton Group plc. It is listed on the London Stock Exchange and is a member of the FTSE 250 Index, having been relegated from the FTSE 100 Index in June 2006.[3]

In July 2015, the company reached an agreement to merge with its rival, Gala Coral Group. Under the terms, Ladbrokes' chief executive Jim Mullen will become CEO of the new company, named Ladbrokes Coral.[4]

History

The company was founded by Mr. Schwind and Pendleton in 1886 as commission agents for horses trained at Ladbroke Hall in Worcestershire. The name Ladbrokes was adopted in 1902 when one Arthur Bendir joined the partnership and operations were moved to London.[5] Ladbrokes' first London offices were situated in the vicinity of the Strand, later moving to Hanover Square in 1906 and, in 1913, the firm graduated to Six Old Burlington Street, Mayfair.[5] From 1913 to acquisition of the firm by Mark Stein (aka Max Parker) and his nephew Cyril Stein in 1956, Ladbrokes' clientele was exclusively drawn from the ranks of the British aristocracy and upper classes, many of whom were members of the elite gentlemen's clubs in the St James's area of Central London.[5]

Unusually for the times, Ladbrokes' principal long-time representative on British racecourses was a woman, Mrs. Helen Vernet. Having joined the firm at behest of Arthur Bendir in 1919, she was made a partner in 1928 and remained with the firm until shortly before her death in 1956, at the age of 80.[5]

Following the end of World War II, the fortunes of Ladbrokes were in steady decline, brought about by a combination of an austere postwar economic climate, a dwindling client base, and reluctance to change the firm's specialised approach to bookmaking. As a result, in 1956 the Company was acquired by Mark Stein and his then 28-year-old nephew, Cyril Stein for a reported £100,000.[6]

In 1961, the government legalised betting shops under the Betting and Gaming Act. As managing director, Stein used profits from the traditional areas of the business to establish a chain of betting shops: he was the first to introduce fixed odds football betting. On the last Saturday of 1963, football results cost the company over £1 million.[5]

In 1966, Cyril Stein became chairman of Ladbrokes and the following year floated the company on the London Stock Exchange at an initial valuation of £1 million. Under his chairmanship the company acquired Texas Homecare in 1986, and in 1995 sold it to J Sainsbury plc, who subsequently integrated it into its own Homebase chain. In 1989, Ladbrokes also acquired Vernons Football Pools.[5] In 1993, at the age of 65, Cyril Stein retired as chairman – at which time Ladbrokes was valued at near £2 billion on the London Stock Exchange.[6]

In 1999, the company acquired the Stakis Hotels chain and rebranded itself as Hilton Group plc. On 29 December 2005, the Company announced the sale of its hotel operations to Hilton Hotels Corporation for £3.3bn and once more rebranded itself Ladbrokes plc.[7]In 2007, the Vernons brand was sold to Sportech.[5]

Following the introduction of the Gambling Act 2005 in the United Kingdom and the subsequent relaxation of advertising laws for gambling companies in 2007, a TV campaign by Ladbrokes, that included a host of ex-professional footballers, was the first to result in complaints to the Advertising Standards Authority (ASA); the ASA eventually cleared the campaign.[8] The Company once again came under fire from the ASA in January 2009 due to complaints received relating to an advertising campaign.[9]

Since 2007, Ladbrokes operated in Spain through the LBApuestas brand but in 2014 it terminated its license for LBApuestas and created a website, Sportium, in a joint venture with the Spanish gaming and leisure operator Cirsa.[10][11]

In November 2009, the Company announced it would close its call centre at Aintree with the loss of 263 jobs.[12] The last day of call centre operations at Aintree was at the end of March 2010.

In January 2012, the Ladbrokes affiliate program introduced a new commission model based on the number of new customers sent every month, valid as from 1 February 2012.[13]

On 5 September 2013, Ladbrokes launched in Australia.[14]

On 30 September 2013, Ladbrokes issued a warning that full year profits from its e-gaming division would be much lower than originally expected. Profits from the division were originally forecast to be £27.5 million (around US $44.4 million) for the year, but had been revised by Ladbrokes to be between £10 million (around US $16.1 million) and £14 million (around $22.6 million). Ladbrokes CEO Richard Glynn said that the lower profit levels for its online gaming operations were due to a number of unexpected events that were encountered by the company over the course of the year. "Our digital earnings have been disappointing, reflecting a lack of competitiveness in sportsbook, lower margins than planned, and a greater disruptive impact than expected from the transition necessary to grow digital for the long term," he said.[15] Its woes relating to income (and earnings) uncertainty continued and in August 2014, Ladbrokes announced a pre-tax profits drop of 49.7% during the first half of 2014.[16]

On 3 December 2014, Ladbrokes announced that it was to look for a replacement for CEO Richard Glynn who was to leave at the end of his five-year term.[17]

In June 2015, Ladbrokes said they were in talks with the board of Gala Coral Group over a possible merger.[18] The deal was officially finalised in July 2015. The proposed combination of the two companies would become Britain`s biggest bookmaker, with over 4,000 betting shops and 30,000 employees.[19]

Investors

From 2007 onwards billionaire John Magnier and his business partner racing tycoon JP McManus have quietly been building a stake in Ladbrokes estimated to be more than 10%.[20] In early 2008 it was discovered that another associate of Magnier's' Joe Lewis had been building a stake now estimated to be approximately 7%.[20]

Notes

  1. 1 2 3 "Preliminary Results 2014". Ladbrokes. Retrieved 30 March 2015.
  2. ↑ "About Us". ladbrokesplc.com. Retrieved 30 March 2015.
  3. ↑ "Vedanta, Lonmin, Drax all to be promoted to FTSE 100 index". Forbes.com.
  4. ↑ "Ladbrokes to merge with smaller rival Coral". BBC. 24 July 2015. Retrieved 25 July 2015.
  5. 1 2 3 4 5 6 7 Ladbrokes History
  6. 1 2 "Obituary - Cyril Stein". London: Daily Telegraph. 23 February 2011.
  7. ↑ "Hilton hotels businesses reunited". BBC.co.uk. 29 December 2005.
  8. ↑ Mark Sweney (19 December 2007). "Ladbrokes ad scores ASA victory". London: Guardian.co.uk.
  9. ↑ "Ladbrokes comes underfire from TV watchdog". Archived from the original on 6 June 2010.
  10. ↑ Staff, Gaming Intelligence. 14 April 2014. Ladbrokes hands back LBApuestas licence to focus on JV
  11. ↑ Staff, Reuters. 2 April 2014.UK bookmaker Ladbrokes to open 70 Spanish shops
  12. ↑ Ladbrokes to close Aintree call centre The Times, 19 November 2009
  13. ↑ "Ladbrokes adds quotas in commission scheme".
  14. ↑ "On September 5, 2013, Ladbrokes Australia launched.".
  15. ↑ "ladbrokes profits below expectations - pokerupdate.com". pokerupdate.com. Retrieved 30 March 2015.
  16. ↑ "Ladbrokes Profits Drop But Remain Optimistic.".
  17. ↑ Alliance News (3 December 2014) "Ladbrokes Starts Looking For Successor To Chief Executive Glynn". via Morningstar. Retrieved 5 December 2014.
  18. ↑ "Ladbrokes in merger talks with Gala Coral Group". BBC News. 23 June 2015.
  19. ↑ http://www.theguardian.com/business/2015/jul/24/ladbrokes-and-gala-coral-to-merge
  20. 1 2 Karl West. "Tycoon Joe Lewis secures £300m stake in Ladbrokes". This is Money.

External links

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