Gala sell Casinos to Rank for £205m

Gala & Rank concluded the deal – which includes the sale of 23 UK-based casinos and three non-operating licences to Rank – over the weekend.

Rank, which is 74.5pc-controlled by Malaysia’s Guoco Group, will become the country’s leading casino operator once the deal completes in September, which is needed to pass the approval of the Office of Fair Trading (OFT).

The takeover of the casinos is conditional on approval by Rank’s shareholders and the receipt of UK merger control clearance.

Gala Coral, which has been through a tough financial restructuring, said it had not taken a final decision on what to do with cash from the sale, although it expects to “reduce the group’s leverage”.

“This transaction will crystallise significant value for our shareholders and debt investors,” said Carl Leaver, chief executive of Gala Coral, which is controlled by a largely private equity shareholder base comprising of 21 different investors.

The deal excludes Gala Coral’s casinos in Dundee and Gibraltar and also the casino freehold properties owned by Gala’s property vehicle. Under Rank’s ownership, Gala’s former casinos will remain the tenants of the freehold properties.

Rank has made no secret of its interest in buying Gala Casinos, but announced on March 29 that earlier talks were off after it balked at the “proposed terms”. The talks resumed last week after the previous discussions broke down over lease agreements, this has now been overcome and Rank will look forward later this year once the OFT agree to be the biggest UK Operator ahead of Genting.