Partner Article

Bets held off for Rank’s casino bid

Rank betting group’s bid for Gala Casinos Ltd. has been referred to the Office of Fair Trading, after concerns that it may reduce competition in the sector, with Rank potentially taking too large a portion of casino business.

The completion of the merger would result in Rank owning the two largest casino operators in the UK, leaving only Rank and Genting at the top of this industry.

OFT’s investigation has been sparked due to worries that this take over would significantly reduce competition and cause too much of a monopoly on a national scale, as well as affecting nine local areas.

Ali Nikpay, OFT Senior Director and Decision Maker in this case said: “Rank and Gala are two of only three large national casino operators in the UK.

“This merger would represent a major consolidation which could be expected to reduce competition, both locally and nationally.

“The high barriers to entry and expansion in the casino sector mean the loss of competition could potentially be irreversible.

“As such, we believe it is appropriate that the Competition Commission reviews this merger in detail to ensure that the interests of consumers are protected.”

OFT also raised concerns that the deal would prevent entry into the casino industry, as well as hindering expansion, with already hard and fast obstacles restricting competition due to licensing issues.

The report from the Office of Fair Trading is expected to come out in February 2013.

The bid for Gala comes after reports said that the Grosvenor Casino and Mecco Bingo brand owners saw a 9% profit rise in 2011/12.

This was posted in Bdaily's Members' News section by Miranda Dobson .