GVC is a massive company. Now, it will become even larger with a new deal. GVC will acquire Ladbrokes Coral, a deal approved by regulators. GVC offered Ladbrokes a “sliding contingent offer,” which needed to be approved by the House of Commons. The HOC will decide the allowable bet set at fixed odds that will determine Ladbroke’s revenues. It is also designed to end gambling addiction. Based on the offer Ladbrokes really couldn’t refuse the GVC deal.
GVC acquired 888’s bwin.party in 2011, which left the company larger than ever. However, it is said the merger was mostly unsuccessful. By adding Ladbrokes Coral, GVC becomes GVC Ladbrokes Coral bwin.party. Of course, this does not include the various satellite operations the company has like Zatrix.
Zatrix is a Greek gaming company. GVC also has Mars LLC, a Georgian business, which goes under the name of Crystalbet.
The downside is that GVC has to leverage its company in a way that could be the end of it if they do not see top performances out of the companies they have merged and acquired. The debt from the other companies and the buyouts are reasonably massive. Ladbrokes Coral was small in comparison to some of the debt GVC has gained. They paid 300 million pounds or just 10 percent of the market cap.
How GVC Manages
It is difficult to say how GVC has managed to acquire all the companies it has, or how it will continue to make money with the new venture. But, one thing is for sure—the market share price for the company keeps climbing. There are business models in the company that are less conservative than other gaming locations, and they have gone into struggling markets. GVC has lost money, about 178 million pounds in two years, and approximately 284 million pounds since it was founded.
It does seem they have a bit of a cycle going on with rising equity by taking on new businesses and raising the share price as they go. The company paid .141 per share for Ladbrokes, which amounted to 625 million and the rest is being spent in equity. When GVC shares increase it becomes more popular, and therefore some buyouts help keep the shares going and partners happy. Most of the money raised from the stocks tend to be turned back into more acquisitions.