LONDON: Confirming it's now conducting talks to take over 24 casinos owned by debt-laden rival Gala Coral, Guoco Group Ltd's Rank Group is poised to leapfrog the Genting Group as the largest gaming operator in the UK.
It is reportedly offering £250 million (RM1.2 billion) for the Gala Coral Outlets and the weekend bid marks a remarkable rise in fortune for Guoco, the Hong Kong-based subsidiary of the Hong Leong Group, which had bought a 11.6% stake in Rank from Genting only in May last year and raising Guoco's shareholding in Rank to 40.8%.
After a mandatory general offer, Guoco now has a 74% stake in FTSE-listed Rank. Should the bid for Gala Coral succeed, Guoco would end up running 59 casinos, easily stealing the title of UK's biggest casino operator as incumbent Genting now operates 45, including its flagship Crockfords casino in London's Mayfair.
Further, Rank has over 100 bingo clubs under the Mecca brand and also owns the Bluesq sports betting and gaming businesses.
There is one potential hiccup to the bid by Guoco, backed by Malaysian billionaire Tan Sri Quek Leng Chan.
Rank had acknowledged this issue in a statetement issued late on Monday: "The terms of any such acquisition have not been finalised and there is no certainty a transaction will occur."
The deal will have to be approved by UK's Competition Commission and it isn't clear how the regulatory body would rule as the two Malaysian firms would end up controlling at least 100 of Britain's 140 casinos.
Rank's Grosvenor unit had earlier announced plans to have 45 casinos by the end of 2015, from 35 now, through the faster roll-out of its G-Casino format, which attracts a younger, less formal crowd.
A sale of the casinos would allow Gala Coral to concentrate on its Gala bingo and Coral bookmaking divisions, as well as strengthen its finances amid a net debt figure of £1.3 billion at the end of 2011.
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