Bookmaker Ladbrokes have finally got their beau after confirming a deal to acquire Betdaq operator Global Betting Exchange Alderney. The deal, which will be completed in late February, is for an initial consideration of €30million and includes an agreement that the Lads will take a 10 percent stake in TBH Guernsey – Betdaq’s technology provider – for €4million. They can choose to acquire the remaining shares in the latter after four years.
Richard Glynn, Lads’ chief executive, added: “The Betdaq exchange is a well-regarded and well invested business and a close strategic fit for Ladbrokes. 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.”
Ladbrokes gave five main rationale for choosing to acquire the company with one in particular being quite interesting. Third down on the list they explain that “a large proportion of Ladbrokes’ customers use a betting exchange” and thus state they will be able to “access a greater share of existing and future customers’ betting expenditure”. This seems to insinuate there’s a chance Ladbrokes punters will, instead of going to Betfair, use the Betdaq product that will be integrated into their site and in turn take share away from the world’s number one betting exchange – which is currently 20 times the size of Betdaq. To do that the Betdaq will have to make vast improvements and it’s unlikely Ladbrokes’ brand alone will be able to push it on to make huge strides.
This point is in addition to Ladbrokes stating they will “create the most comprehensive sports betting service in the market” and accelerating their strategy of “investment in proprietary technology” to give customers a “differentiated experience”.
The stock market has already sat up and taken notice as shares rose in early trading by 3.28 percent to 205.95p. Davy Research analysts commented that although the price itself was very cheap they still remain fairly unconvinced that Ladbrokes can turn around the fortunes of the betting exchange without a big marketing outlay. If they can take away some share from Betfair then this might just be a good little purchase for Glynn to make though.