Bookmakers slide as govt eyes £2 max stake on betting machines

Business News

Shares in Ladbrokes Coral, fell by more than 12 percent on Monday on reports that Britain is set to lower the limit on betting shop terminals to 2 pounds from 100 pounds in a move that could hit their revenue.

The move is being taken to help tackle the issue of problem gambling, the Sunday Times newspaper reported, citing an ally of new culture secretary Matt Hancock.

The government said in October it would reduce the top stake on the machines to between 2 and 50 pounds from 100 pounds depending on the outcome of a consultation which ends on Tuesday.

The move could mean a sharp reduction in revenue from the fixed odds betting terminals (FOBTs) in shops for companies such as Ladbrokes Coral, William Hill and Paddy Power.

Shares in William Hill were down 14.5 percent at 288 pence at 0848 GMT and were the biggest loser on the FTSE mid-cap index. Ladbrokes shares were down 12.3 percent and Paddy Power was off 1.8 percent at 8,300p.

There are almost 8,800 betting shops in the UK and companies are allowed to install a maximum of four machines per shop.

Ladbrokes Coral Group, currently Britain’s largest bookmaker, has more than 3,500 betting shops employing over 25,000 people. William Hill has 2,376 betting shops employing more than 12,500.

Ladbrokes declined to comment on the Sunday Times report.

Ladbrokes, which is being bought by GVC for up to 4 billion pounds, made about 800 million pounds of revenue from gaming machines in 2016. Bookmakers say they would be forced to close stores if they lose the income from the machines.