Gambling group gears up for flotation

BOOKMAKER Coral Eurobet is said to be preparing for a €1.1 billion stockmarket flotation.

A listing would make it the latest in a number of firms to cash in on the stockmarket’s appetite for gambling stocks, following the recent flotations of internet poker groups Party Gaming and Empire Online.

It would mark a major windfall for the management team, led by chief executive Vaughn Ashdown. Coral’s management owns 16% of the business, which would be worth around £128 million at the value being discussed.

The remainder of the group is owned by private equity firm Charterhouse, which backed a management buyout in 2002.

According to reports, Coral has hired investment bank Lehman Brothers as its adviser.

A flotation is said to be its preferred option, although a trade sale has not been ruled out.

However, the company’s £1.2bn debt means any prospective buyer would have to find £2bn to fund the deal.

Barking, Essex-based Coral was founded in 1926. As well as its retail outlets, it has a telephone betting operation, an online betting arm and greyhound racing tracks in Romford, Essex and Hove, East Sussex.

The group has bought a number of smaller chains in recent years and a flotation is expected to help fund further acquisitions.

Coral makes annual operating profits of around £145m on sales of £5.4bn (€7.8bn).