Ladbrokes boss makes the biggest gamble of his career

I was brought up with my grandparents,” says Ladbrokes chief executive Jim Mullen, and they “would show me how to put on bets”.

“What I didn’t know at the time was my grandfather and my grandmother were teaching me my arithmetic and fractions.

“They were putting a bet on and then I would have to work out what the winnings were, and that was the game we played on a Saturday and a Sunday.

“I look back on it fondly as I try to do the same with my own sons now.”

Mullen has been enthusiastic about gambling ever since those early maths lessons. And Ladbrokes’ £2.3bn merger with rival bookie Coral arguably marks his biggest wager yet.

Beleaguered Ladbrokes has lost ground to competitors in recent years and Mullen hopes to reverse that decline by combining the company with Coral to create Britain’s biggest bookie, a giant with about 4,000 betting shops.

Informal talks between the two companies started before Mullen took over at Ladbrokes in April. However, Mullen has been central to the deal since taking charge of the troubled bookie, and is emphatic the merger will help revive its fortunes.

But the tie-up faces challenges that Mullen, who will lead the merged company, must overcome.

The biggest is securing the approval of the Competition and Markets Authority (CMA) without being forced to sell so many shops the deal becomes unworkable.

Some analysts have estimated the regulator could demand that Ladbrokes Coral, as the combined business would be called, offloads more than 1,000 shops. Mullen dismisses this as “just a farcical figure” and adds: “I would hope that the CMA… knows that we’re doing this obviously to grow scale in a sector which I believe is con-solidating.”

Mullen must also contend with opposition to the deal from a vocal Ladbrokes shareholder, the Irish billionaire Dermot Desmond. The tycoon urged investors to block the tie-up, arguing the merger encumbers Ladbrokes’ shareholders with privately-owned Coral’s debt.

Although shareholders overwhelmingly approved the deal last month, Desmond, who has encouraged Ladbrokes to hire new M&A advisers to examine alternatives to the Coral deal, has pledged to fight on. Despite that threat, Mullen refuses to criticise the outspoken investor.

“I am happy to discuss and debate the concerns that he has, but I’m just not quite clear what the alternative is,” he says.

Does he like Desmond? “Yes,” comes the quick reply, “because he invests in Ladbrokes and I like my shareholders. I also like that he’s invested in Celtic and it’s my hometown club.”

Born in Glasgow, Mullen, 45, is an avid fan of Celtic and enjoys betting on Scottish football “because I think I know something about it”.

Practising his sums with his grandparents, Mullen, now a married father of two boys, grew familiar with gambling from a young age.
“All my family went to betting shops,” he says. “I was brought up where it was a pastime.”

After leaving John Ogilvie High School in Hamilton in South Lanarkshire, Mullen studied computing at Glasgow Caledonian University, when he made a killing staking a considerable portion of his student grant on Celtic winning the double. Gambling aside, Mullen, who also has an MSc in software engineering, funded his student days working in a William Hill betting shop, and after graduating took a job at Celtic’s rival club, Rangers, developing its ticketing.

Jobs at advertising agencies both in Scotland and London were followed by a spell at News International where, among other things, Mullen developed digital strategy for Sun Bingo. He then joined William Hill’s online business as chief operating officer in 2010 before moving to Ladbrokes in 2013 to lead its digital operations.

Mullen is refreshingly honest about the mistakes that have damaged Ladbrokes.

“We missed out in football,” he concedes, admitting that rivals “stole a march” in developing bet-in-play products for the game.

Under his predecessor, Richard Glynn, Ladbrokes focused on building its own in-house digital technology rather joining rivals in enlisting the expert help of third parties such as Playtech. It was “a brave decision”, Mullen says, but “it didn’t work out and put us back three years”. Ladbrokes eventually struck a partnership with Playtech in 2013.

Still, Mullen will not blame Glynn for Ladbrokes’s misfortunes.

“I got on well with Richard; he made some informed decisions and some of the bets didn’t pay off. But I’ve been the CEO for eight months now, so you need to starting looking at Jim Mullen,” he says.

Certainly, the new boss has been quick to develop a turnaround plan, which he unveiled in July alongside a dividend cut.

While waiting for the CMA to investigate the Coral merger, Mullen wants to transform Ladbrokes into a “multi-channel” business.

Quarterly results in October showed Mullen’s plan is starting to bear fruit, with the bookie having acquired more than 20,000 new active online punters through its shops.

However, despite that progress, the Ladbrokes boss is adamant the entire industry now requires respite from new regulation if bookies are to successfully plan for the future.

Since last December, gambling firms have been hit by a 15pc tax on online betting, an increase in the duty on gaming machines to 20pc, and restrictions on staking on fixed odds betting terminals.

“I just ask for clear air from the government and regulators,” says Mullen, who believes the divisive industry “needs defending by leaders who actually love the sector”.

He is scathing of critics who he believes do not understand gambling, which has staunch opponents.

“I just don’t like people who have never put a bet on who make judgement calls on this sector provides,” Mullen says.

He speaks with equal passion about horse racing, where an escalating row over racing funding could see some bookies barred by the sport from sponsoring events.

“I will be showing up at all of the opportunities to sponsor racing until racing tells me I’m not welcome,” Mullen says.

He warns that if Ladbrokes is forced to divert its sponsorship money into other sports “it will take three years for it to come back [to racing]. That would be a very, very dangerous place for us to get to.”

Ladbrokes is “fanatical” about racing, making it a natural sponsorship partner for the sport, says Mullen.

Indeed, the first bet he can remember placing with his grandparents was on Red Rum’s third Grand National win.

Mullen says his two sons are not bad at picking race winners, either.

“By going on the colour of silks, their performance has been far better than mine from following the form, which is the great thing about sport.”

PokerStars rolls out BetStars 1.0

Having confirmed that subsidiary PokerStars would be launching a standalone betting product, Amaya Inc has today debuted BetStars.com version 1 for select jurisdictions.

The new brand will operate under the domains Betstars.com, Betstars.eu, and Betstars.uk, and on dedicated iOS and Android applications, marking the initial first stage of Amaya and PokerStars’ entry into the sports betting market.

Amaya confirmed that the sports betting product would be supported with a new sportsbook platform which would be rolled out in early 2016.

PokerStars will further support its new brand with an external customer acquisition campaign in the first half of 2016. As part of this marketing campaign, BetStars intends to introduce an innovative new betting product on the platform which will distinguish the brand from competitors.

Rafi Ashkenazi, CEO of Rational Group, commented on the initial launch of the BetStars brand

“We’re very excited about the launch of the BetStars brand, and expect it to be one of the most talked about sports betting sites in 2016 as it continues to evolve with new products and features that we believe will set us apart as a betting brand for the true sports fan. We’re applying the same dedication and passion we have for poker to sports betting, and intend to create an authentic, world-class offering. The BetStars brand will build on this passion and provide a safe, trustworthy and, most importantly, exciting environment for sports fans.”

BetStars will initially offer a range of betting options across more than 25 sports, including football, tennis and basketball, as well as specialty offerings such as eSports and poker. More sports markets will be made available in 2016, including horseracing.

The brand will also feature a range of in-play betting options and exclusive offers and promotions that sports bettors expect from a world-class online sportsbook. PokerStars anticipates the brand will expand into additional key jurisdictions throughout 2016, extending its reach to approximately half of PokerStars’ unique active poker customers.

Brazil allows for gambling debate but national framework still faces long road

he Brazilian off and on approach to regulating gambling appears to be on again after a special review committee for the Brazilian Senate progressed the legislative agenda for a regulated national betting industry.

The idea of regulating gambling in a country that banned bingo reletively recently in 2007 was mooted earlier this year as the government faced a fiscal crunch.

Bill 186 has now been approved by the Special Committee on National Development, with the body reportedly including research on the prospect of opening a legalised national online gambling framework.

The committee’s findings, which includes the potential for 35 casinos in the country, will now be open for discussion to members of the Brazilian senate.

In light of its progress, Brazil’s pro-gambling lobby has stated that any new national gambling framework still faces a long road to becoming a reality, betting consumers and campaigners should therefore remain objective about the country adopting a legalised agenda in the near future.

2015 has seen Brazil suffer a financial ‘annus horribilis’ as the country sees its worst economic growth performance in 25 years. Furthermore this week the Moody Investor Service downgraded Brazil investment grade to ‘Junk Status’.

Close associates of President Dilma Rousseff have publicly stated that the government are willing to implement a new national gambling framework as state public funding initiatives appear to be “cash-strapped”.

However Rousseff critics have pointed out that the government are in no way prepared to act on their ‘easy rhetoric’, as any talk of progress on a national gambling agenda is met with in-action.

Leading Brazilian political figureheads have agreed that the government can no longer afford to ignore a potentially regulated industry that could raise an estimated R$ 23 billion (£4 billion) in taxes. Furthermore all political parties appear to agree that at present national gambling laws are simply out of date with modern consumer habits.

Brazil’s slow progress towards even reviewing its gambling framework has left many commentators cynically questioning whether any government would want to pass a national gambling framework which will potentially have to satisfy multiple stakeholders; at intra-state level, national sporting bodies, federal police and a divided senate.

Betfred looking at 500 betting shop sale off

With the Ladbrokes and Coral deal moving forward with the £2.3 billion merger, Betfred are looking to possibly snap up some 500 betting shops from the newly combined betting firm that Betfred believe will have to be sold to allow the deal through the Competitions Commission.

Currently Ladbrokes and Coral have a combined estate of 4,000 sites and to get the deal through the competition commission the business believes it will have to shed some 500 betting shops and that’s where Betfred hope to profit.

Fred Done, who founded the business with his brother Peter 48 years ago, told The Sunday Telegraph he would “absolutely” be willing to talk to the bookmakers about buying sites offloaded to gain regulatory approval for the deal.

“We operate just short of 1,400 shops, another 400 or 500 shops wouldn’t be a problem to run,” he said. “If somebody knocks at my door and says: ‘Fred, do you want to buy some of these shops?’, I’d like to sit down with Coral and Ladbrokes and have a discussion with them.”

Most analyst’s say that with the merged company having some 45% share of the market by the number of betting shops and 47% share of total revenues in betting shops in the UK many say that a sale of some 500 shops will have to happen to reduce that share percentage.

However Betfred think there will be competition for those shops from Paddy Power, private equity firms and foreign buyers.

Australia should not ask tech firms to block illegal gambling sites

As the Australian government look at ways of blocking illegal online gambling sites offering their services to Australians, many of the leading online companies say it is impossible to block those sites.

Twitter, Facebook and Google all said to wagering review chairman Barry O’Farrell it is impossible to block offshore online gambling sites and the government should not burden the online tech companies to help to do this.

“We consider there to be fundamental flaws and significant practical difficulties with any attempts to filter the Internet such that it may not be possible to automatically block content,” the companies said in a joint submission to the government under their Digital Industry Group association. “Who would determine whether a service is illegal and would entire websites be blocked if there are both legal and illegal services on the website?”.

Figures show that Australian nationals gamble some $24 billion a year and it is estimate $1 billion is to offshore illegal gambling sites that the government want to stop.

The government want tech companies to install web filtering to block these sites but in a joint statement to the review board the companies say it is unworkable.

Those tech giants also have big concerns around its own legal liability should it move to cut access to commercial websites.

“We have concerns around legal liability in preventing access to commercial websites and question what safe harbours would be provided. In addition, internet filters can be easily circumnavigated and information about how to use virtual private networks (VPNs) is widely available. There is no existing legal precedent in Australia requiring Internet companies that are not ISPs to filter access to websites,” the note to the review board says.

Bearded Bucks: Minnesota Lottery Goes Hipster with Artist Chuck U

Bearded Bucks scratch-off cards from the Minnesota Lottery represent the peak of hipster state lottery operations. Not only can players win $10,000 by scratching off the beard of a lumbersexual to find craft beers and bird silhouettes but losers can also enter that card to win an art print signed by hipster artist favorite Chuck U.

Minneapolis-based ad agency Olson pitched the idea “and worked with the artist on the design of the ticket, which is unique and, given the number of bearded, plaid-wearing men in Minnesota this time of year, undeniably on-trend,” said Vicki Holets, Minnesota Lottery Marketing Manager

The Lottery is well aware it is satirizing Minnesota’s many hipsters. Its dedicated Bearded Bucks page begins, “Ladies and gentleman, hipsters and dudes, it’s time to get your beard on!” And, of course, there is the winning bird silhouette.

Why a bird, those unfamiliar with hipster icons might ask? Because, “putting a bird on it!” is what hipsters do. Kind of the same way craft beer is hipster. Speaking of craft beer…

And to promote Bearded Bucks, the Lottery went on a Tour De Beards that included craft breweries across Minneapolis-St. Paul. It also started a “Chancetaker” series, featuring Minnesotans like the co-founder of craft beer brewery Tin Whiskers, which also held a Lottery-sponsored beard contest in October.

And then there are the recent TV commercials best described as a combination of Wes Anderson scenes, Tumblr memes and Geico commercials.

“Customers have liked Bearded Bucks,” said Holets of the game’s reception. “The game is performing slightly above average for a $2 ticket, which we attribute to regular players liking the game and new customers trying out an eye-catching product.”

Hipster themes in state lottery communications are not new—18 months ago, New York flirted creatively with hipster stereotypes for its “Bejeweled” game.

But being a true hipster means being able to say you were into it before it was cool—and the Oregon Lottery can brag that it was doing hipster lottery back before it was cool. It even put a bird on it.

Nonetheless, the Minnesota Lottery has no intention of giving up on hipsters—Holets says it will “absolutely” do more “hipster” lottery promotions. “We had a blast promoting this game at craft breweries and other plaid-friendly locations, so we are working on new products that will appeal to that audience.”

Meanwhile lottery hipsters will have to vie with the lottery undead. Oregon Lottery’s latest theme is trendy zombies.

Not so fast Oregon, the student has become the master. Minnesota Lottery’s got its own zombie-themed lottery game. This one is a partnership with AMC’s The Walking Dead.

Prague to close down gambling arcades

The Prague City Assembly has voted to close all the 212 gambling sites that are overtaking the cities streets say lawmakers. The new legislation does not affect the 101 casinos within the city but the cafe or slot arcade style gaming centres.

The new law will take effect in January 2016 with a gradual closure of the gambling sites which some say could take a year or even more to happen.

“The operation of gambling is connected with a number of sociological and pathological phenomena,” Mayor Adriana Krnacova said.

Proposals were put forward back in 2008 to draw back the number of slot machines in the city from 8,358 to 2,724 however this did not happen and the new legislation hopes to address this.

Punters’ forum to tackle bookies on restricting and closing accounts

The newly created body that represents racing’s punters is to tackle bookmakers over the way firms close and restrict the accounts of successful gamblers. The issue has been a hot topic in racing’s corner of the social media world for months on end and concern that it may be undermining the sport’s appeal has spread as far as the corridors of the British Horseracing Authority.

“That’s certainly far and away the thing that’s been brought up most with us,” said Simon Rowlands, a Timeform veteran who chairs the Horserace Bettors Forum (HBF) and has been gathering the views and concerns of punters since the summer. As the Forum’s second meeting drew to a close this week, he said: “We’re not imagining that people will dance to our tune but we’ve got a few recommendations. We will be contacting bookmakers and running those ideas past them.

“Punters should know in advance what sort of activity is likely to get them restricted or closed and ideally should have a right of review if action is taken against them. The individual suddenly being knocked back is an existing or potential customer of horse racing, not just of the bookmaker in question, after all.”

Rowlands and his colleagues are concerned bookmakers are putting too much faith in “rigid trading algorithms” designed to highlight “arbitrageurs”, whose business is seen as unprofitable and unattractive by the betting industry. The fear is many of what may be termed “innocent punters” are being denied a bet for no good reason.

A “more nuanced approach” is called for by Rowlands, who added: “Should anyone be prevented from betting £100 on the Grand National just because they successfully arbed a bet on football? Racing needs that turnover and that engaged customer.

“We would also like to establish the magnitude of the problem of restrictions and closures, which would require assistance from within betting. Judged by HBF’s mail bag, it is a major concern for many punters of many different kinds but that is not sure to be representative.”

Officials at the British Horseracing Authority acknowledge account closures and restrictions as a matter of concern but feel there is little chance of a positive response, should they try to tell bookmakers how to handle their business, particularly in the present climate of tension between racing and betting over funding. So it will be up to the HBF to press racing’s case.

The Forum was set up in August as the result of a determination by the BHA’s new chief executive, Nick Rust, that punters should be given a public voice. Its first two meetings have been at the BHA’s London office but they will be elsewhere from this point as the HBF moves to assert its independence, which will also involve the creation of its own website.

“There are certain things we would want to make statements on that may not necessarily represent BHA policy,” said the HBF’s Jason Brautigam, the chief executive of British Dressage in his day job. “If it appears on their website, there’s implicit endorsement, so we’ve got to try to make sure the two are seen as slightly separate.”

The Forum’s nine members, all unpaid, still seemed enthused about the project of advancing the interests of racing punters as their lengthy discussion ended on Monday, more than one voice insisting this will not be “just another talking shop” and that they hope to have real influence over time.

“It’s not going to happen in five minutes but we all knew that in the first place,” said Steven Tilley, a local councillor. “The amazing thing is, you’ve got a whole group of people who bet, all who are opinionated and all of whom actually seem to get along together and seem to be coming up with a consensus view a lot of the time, which I think is amazing. We’re a group of contrarians here and yet we’ve managed to get a consensus.”

Teddy Sagi’s Playtech Losing Two Major Acquisitions In One Day

Major London listed gambling software company Playtech may have suffered a double reverse as it has been forced to cancel one major acquisition, with a second also, seemingly, headed for the rocks. The two deals were intended to help diversify the company away from its existing business which, while still profitable, may be facing pressures in the future if its gambling company customers start to develop their own software for their casinos.

The UK’s financial regulator is the FCA, or Financial Conduct Authority, which has to this point refused to permit Playtech’s previously announced deal to acquire Plus500, a junior London listed company, for about $700 million to go through citing certain concerns, according to a press release put out by Playtech earlier today. Cyprus financial regulators, who also have jurisdiction, have earlier already approved the transaction.

Plus500 are in the business of enabling trading for contracts for difference, or CFDs, which is a form of speculation on movements in the prices of equities without owning the underlying security. With substantial leverage available the prices of CFDs can fluctuate widely, and carry significant risk therefor and these are products generally suitable for sophisticated investors as a result. In addition to covering equity CFDs, the company trades CFDs for other financial markets including commodities and foreign exchange.

As a company engaged in such financial products, within the UK Plus500 is regulated by the FCA who, it is said by a number of news media today, may indeed be worried by the background of Playtech’s founder, and major shareholder, Teddy Sagi. Though he no longer sits on its board of directors Sagi, who still owns around 30 percent of Playtech, was apparently convicted of fraud in Israel some twenty years ago.

In addition, some analysts have noted, the FCA may have been legitimately nervous of Playtech’s lack of knowledge and experience in the CFD business itself, which occupies a fairly esoteric and specialized corner of the financial marketplace.

Israeli financial newspaper Globes reports that, after extensive representations to the FCA over the last few months, the deal finally may have cratered over demands by the FCA to significantly reduce Sagi’s personal financial holding in Playtech as a condition for approval, though this is unconfirmed.

Since it never rains but it pours, another currently pending Playtech acquisition, to buy a second, smaller, broker of CFDs, the Dublin based trader Ava Trade, for $105 million also appeared near to collapse today after, Playtech said in the same press release, concerns stated by the Central Bank of Ireland back in October.

Playtech has stated it will not incur any penalties relating to these set-backs, except to have to give up a $5 million non-refundable deposit it has made for the second, Ava Trade, deal in the event it also collapses as well.

Clearly regulators are very sensitive these days to which entities can play in the financial services game and have raised the bar, it seems, in this case to block an entity controlled currently by a complete outsider to the industry, and someone who clearly has something of a checkered past moreover.

mybet to raise €5m to fund sports betting expansion plans

German gaming operator mybet Holding intends to raise €5m through the issue of a new convertible bond, with proceeds to be used for the expansion of the company’s marketing and technology platform.

mybet will issue a bond with conversion right in the maximum total nominal value of up to €5m. The measure is still subject to a final management board resolution, which will also specify the details of the issuance and the terms of the bond.

It will also need the consent of the company’s supervisory board later this month.

The operator said that it will use the proceeds for the expansion of its marketing and technology platform, including expanding the betting range, acquiring new customers through increased marketing activities, and for advertising of games in the wider context of the UEFA European Championship in 2016.

The convertible bond is expected to be issued in December and have a term of five years.

During the term the bondholders have the irrevocable right, within certain conversion periods, to convert debentures into no par value shares of mybet, each representing a notional share of the capital stock of €1.00. The convertible bond is to attract interest at a rate of 6.25 per cent per annum on its nominal value.

The issue amount, taking into account the present share price, will represent 100 per cent of the nominal amount and will be €100.00 per debenture. The convertible bond is to be collateralised by the pledging of shares of pferdewetten.de, which is owned by mybet.