Moody’s affirms Ladbrokes on merger

Moody's Investors Service said it affirmed Ladbrokes plc's Ba2 corporate family rating and Ba2-PD probability of default rating.

At the same time, the agency affirmed the Ba2 rating on the €225 million senior unsecured notes due 2017 issued by Ladbrokes Group Finance plc.

The outlook remains stable.

Moody’s said the action was prompted by its expectation that Ladbrokes' merger with Coral (Gala Electric Casinos plc, B1 under review for upgrade) will be completed in the near-term. The agency also expects the ratings of Coral to be withdrawn upon completion of the transaction, including the repayment of all its outstanding debt.

"The transaction will improve the business profile of Ladbrokes as a stand-alone entity. That said, risks arise in integrating the two companies, namely the associated costs and an increase in the debt burden," Moody’s vice president, senior analyst Donatella Maso said in a news release.

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