Gala near £2.1bn Coral takeover

The bingo operator Gala is close to buying Coral Eurobet in a takeover that could trigger a £128m windfall for the bookmaker's senior staff and managers.

The deal, which is expected by the end of this week, is set to value Coral and its debt at £2.1bn. Senior staff at Coral hold a 16 per cent stake in the bookmaker, which would net them more than £128m.

Coral's chief executive, Vaughan Ashdown, and its finance director, Mick Mariscotti are set to stay with the new group, according to reports last night. John Kelly, the chairman of Gala, is expected to take on the same role at the combined group, while Gala's Neil Goulden will remain as chief executive.

The merged group, which will be worth about £4bn, stands to benefit from the deregulation of gaming industry being introduced by the Government. It will encompass more than 1,200 betting shops, 30 casinos and 166 bingo halls.

Coral Eurobet was bought by the private equity firm Charterhouse in 2002 for £860m including debt. Its equity is currently valued at about £800m, while its debt is now about £1.2bn.

Charterhouse had intended to float the bookmaker on the London Stock Exchange within the next 18 months. However, the flotation plan flushed out potential bidders, including Gala and the private equity firm CVC. Gala, which is owned by the private equity groups Permira, Candover and Cinven, meanwhile shelved its own flotation plans this summer.