Rank may have to sell to buy

19/12/2012

The UK’s Competition Commission has ruled that Rank Group may have to sell six casinos to obtain approval for its takeover of Gala Casinos.

In a provisional ruling, the commission said a merger could damage competition in six areas of the UK. As a result, Rank may have to sell, or be prevented from buying, casinos in these areas for the deal to go through.

Under the deal announced in May, Rank planned to buy Gala’s 23 casinos and licences to operate three more. However, the takeover was referred by the Office of Fair Trading to the Competition Commission in August, with the OFT citing “concerns the merger will substantially reduce competition in the casino sector.”

Although the takeover offer lapsed in September, Rank said at the time that the two firms were continuing discussions. The were five areas where there were worries that competition could be hit by the takeover – Aberdeen, Liverpool/New Brighton, Stockton-on-Tees, Bristol and Cardiff. In addition, there was concern over the impact in Edinburgh, where Rank holds a licence to develop a new casino.

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