It was reported that New York-based investment management company BlackRock has purchased a 4.7% stake in British gaming operator Ladbrokes PLC. The stake acquisition comes just before tomorrow’s presentation concerning the latter company’s financial performance during 2014.
It seems that BlackRock has taken good advantage of the drop in Ladbrokes’ share price at the beginning of this week. Yet, the purchase was found a bit surprising by some prominent London-based financial analysts. This is due to the fact that it was only yesterday when Deutsche Bank issued a warning that the gaming operator has suffered further losses and decrease in profits since the beginning of 2015.
Back in January, Ladbrokes’ share price reached its lowest level in more than twenty years. This was attributed to the various new taxes imposed on the gaming operator’s retail and online operations since the beginning of 2015.
According to experts, tomorrow’s financial presentation is not likely to reveal any positive news for the company’s performance throughout the past twelve months.
London-based analysts suggested that BlackRock will probably look to quickly gain from the gaming operator’s value and share price.
Back in December 2014, Ladbrokes’ CEO Richard Glynn announced that he was to step down from his position. At present, the company is looking for its new head. Experts believe that the new CEO will apply new strategy, so as to improve the operator’s position on the market and to make it able to compete with its biggest rivals, Paddy Power and William being among these.
Ladbrokes and its continuously declining financial performance have been a hot topic for quite some time. People that have considerable knowledge on the matter claim that the gaming operator could be subjected to more buyouts in the months to come.
Earlier this week, Richard Carter, an analyst for Deutsche Bank, said in an interview for local media that Ladbrokes’ problem is “deeper and more structural” that everyone has initially suggested. Additional investment will be needed for it to be solved as well as further restructuring and applying new business strategies.
A few days ago, it was reported that the gaming operator is planning to close up to sixty of its shops across the United Kingdom. This is the third set of closures that the company undertakes, as back in February 2014, it shuttered 50 of its shops. Sixty more were shut in October. With that said, the number of Ladbrokes’ operating sites will be reduced to a total of 2,150.
