Ladbrokes avoids acquisitions

Ever since it removed itself from its business relationship with the Hilton International hotels group last February of this year, the British bookmaker Ladbrokes has actually been actively exploring international expansion in the United States and in Italy. But surprisingly there is one thing that the company seems to be very reluctant in making expansion moves on – and that is its current online capabilities.In recent months there has been a growing concerted focus by various online companies like frontrunners PartyGaming and 888 Holdings to acquire internet sportsbooks that possess a customer base that is more rooted in regions or countries outside the United States. Ladbrokes believes though that the company can acquire more value by developing its existing brand.

Ladbrokes chief executive Chris Bell recently said no to a bid for the Victor Chandler group – a company that is a significant target for PartyGaming. According to John O’Reilly, the managing director of Ladbrokes’ e-gaming division, they felt that “Lots and lots of customers have lots of accounts.”

“So what we’d be buying would be a list of customers, many of whom already had accounts with us. We’re better off spending £51 a head [its current average] to recruit a new player rather than paying for customer acquisitions,” he further explained.

On the other hand, Ladbrokes recently reported that it posted a 12.3 per cent rise in its operating profits that was pegged at £151.3 million in the six months to June. The company also revealed that it made a total of almost £17.5 million just from this year’s recently held football World Cup.