Ladbrokes’ Sportingbet Saga Comes To An End
Ladbrokes and Sportingbet announced on Monday (10 October 2011) that they had agreed to end discussions about a possible offer for Sportingbet by Ladbrokes.
In explaining the reason that the talks had been “mutually terminated”, Ladbrokes’ CEO Richard Glynn said:

“In August of last year we laid out a very clear organic strategy and investment programme for the reinvigoration of Ladbrokes. We were also clear on the intention to explore opportunities which enabled us to accelerate our progress that enhanced shareholder value and without exposure to non mitigatable regulatory liability.”
“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. 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’ shares fell by almost 20% when news of the termination was announced. But the company bounced back quickly as, only two days later, it announced the acquisition of Danbook Limited and Scandic Bookmakers Limited for a maximum possible payment of GB£8.5 million.
Both Danbook and Scandic have Denmark as one of their primary markets, a country which has new Internet gambling regulation coming into force on 1 January 2012. The first licences in this new Danish regime will be issued in mid-December 2011.
One of the main stumbling blocks of the Ladbrokes-Sportingbet merger was the possible fallout from Sportingbet’ revenues in unregulated markets like Turkey (even if the company sold off this aspect of its operations). 
Sportingbet CEO Andrew McIver stated that the purchases of these two Danish-facing businesses “emphasises Sportingbet’ commitment to generating revenue from regulated markets”.
Ladbrokes, meanwhile, reported Q3 2011 results that show it is still in need of a plan to improve its Digital division.
Revenues in the Digital division fell by 0.7% in Q3 2011. The amounts staked through the sports book increased by 6.4% year on year but the gross win margin was lower at 6.1% (Q3 2010: 6.7%).
Casino was the best performing sector of Ladbrokes’ Digital division where net revenue grew by 11.2%. Ladbrokes online poker net revenue was down by 12.5%, whilst its online bingo net revenue fell by 5.7% in the third quarter. 
CEO Richard Glynn said “In November we start live testing of our new online Sportsbook which will launch in Q1 next year, enabling us to promote our expanding range of betting and gaming opportunities more effectively. In Mobile we will launch up to 40 new casino style slots over the next few months and in October will offer live streaming of 100% of UK horseracing.”