Ladbrokes places bet on Spain with joint venture

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The Independent Online

The bookmaker Ladbrokes is expanding its European operations with a joint venture in Spain as the country moves to deregulate its betting shops.

The alliance with Cirsa Slot, Spain's leading slot-machine company, will apply for new five-year licences being offered in Madrid after the local government passed a decree opening up its gambling market last month. Several more of Spain's 16 regions are expected to follow suit and Ladbrokes said it was working to secure licences in those areas too.

Christopher Bell, Ladbrokes chief executive, said the move represented "another major step forward in our international aspirations".

Since splitting with its parent company Hilton Group last February, Ladbrokes has increasingly targeted markets outside Britain. Last month it won 142 licences in Italy for sports and horse betting over the internet and by telephone.

It is looking at ways to further expand into China, where it acts as a consultant on sports betting shops for the Beijing state-owned lottery. Its negotiations to buy the internet gaming group 888 continue.

On the Spanish front, Mr Bell said he was confident the combination of Ladbrokes' experience in betting and the local knowledge and operational capability of Cirsa would "build a strong business". He added: "We have formed a JV with a market leader in Spain that gives us access to a network of thousands of potential site operators."

Cirsa Slot accounts for 9 per cent of the Spanish slot machine market and operates in 15,000 food outlets and 90 arcades. It is part of Cirsa Corporation, which owns and operates 22 traditional casinos, arcades and bingo halls. It employs 16,000 people across 70 countries.

Pablo Alcala, the director of Cirsa Slot, said the venture would benefit from sports betting becoming an "increasingly mainstream activity in Spain".

The licence applications are likely to be submitted this month and Ladbrokes expects to hear whether its application has been successful in the first quarter.

Simon French, an analyst at Numis, said Ladbrokes' international strategy was beginning to gain momentum. "We think the Ebit [earnings before interest and tax] contribution from international operations is likely to be at the upper end of the £20m-£40m guidance within three to five years," he said.

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