Ladbrokes had been in talks with Sportingbet since June, but Sportingbet’s online gambling business in the tough regulatory regime of Turkey was seen by analysts as a stumbling block to a successful takeover.
“The potential benefits and risks associated with a combination with Sportingbet were clear to us from the outset and have been well covered by the market,” said Ladbrokes chief executive Richard Glynn in a statement yesterday.
“Having completed our analysis we have been unable to agree a structure which delivers increased shareholder value within an acceptable regulatory environment. We have therefore agreed to end our discussions.”
Sportingbet has no assets in Turkey but operates a website offering bets to Turkish residents. Ladbrokes has pulled out of previous deals because of its aversion to operating in unregulated territories.
Glynn said on a call with reporters he did not believe Ladbrokes was a risk averse company but saw too many hurdles to a Sportingbet deal. “There’s just not a structure we can agree on that gives our shareholders an acceptable level of ... regulatory risk,” he said.
Sportingbet shares tumbled 19.1 per cent to 37p on the news, while Ladbrokes shares ended the day down 0.75 per cent at 119.7p.