Most of us were caught out by the news today that Ladbrokes have bought into the Australian betting market, acquiring local firm Bookmaker.com.au for around £13m (AUD22m). The website was only created in February 2012 by Queensland bookmaker Dean Shannon and is reported to have taken over $400m in bets since opening. (Note to UK online bookies - this is called 'old school bookmaking', actually laying a bet). Along with the bookie client list though, there are some other assets of value involved in this sale - according to Bookmakers Review, an affiliate network of approximately 3000 sites focused almost exclusively on racing, and a very impressive website which several innovative features tailored to the Australian market, but could easily be adapted for wider use with Ladbrokes.
This is an interesting entry point for Ladbrokes - it's been well publicised they have been sniffing around looking for a firm to buy into the Aussie market. They looked at the Victorian tote licence, they will have courted Tom Waterhouse, Centrebet and just about every other firm with an Australian licence. Several European firms have looked closely at BetEzy and everyone of them has run for the hills when they've seen the books. Betstar are still holding out - is it really a good idea to refuse the millions being thrown around by international firms? Perhaps Alan Eskander doesn't want to spend the rest of his life on a golf course spending the sale money... Betfred seem to be going it alone in Australia (too late she cried?) and Bwin are still floating around - the market isn't settled yet.
I've heard comments that if Bookmaker.com.au is worth $22m, then Tom Waterhouse went way too cheaply at up to $110m based on performance. I don't necessarily agree - Waterhouse sold his online operation. There is nothing particularly special about his website and his 'success' has been based on very expensive PR campaigns. By all reports, that meant his books weren't in the black. Was there an intricate network of affiliate sites driving significant traffic to his site? Not that I am aware of. The Sydney press lapped up the quotes of the company being worth up to $500m but they were purely fantasy, trying to drive up the price. As George Constanza said "It's only a lie if you don't believe it...". By purchasing Dean Shannon's firm, Ladbrokes can have yet another crack at creating a decent website. Their online results lag further behind their rivals than a four-mile chaser in a 1000m sprint and in the last year they've done deals with Betdaq, Playtech and now Bookmaker.com.au, heavily focusing on the technology. Throw enough darts and one might eventually hit the board....
The big rumour though is who they plan to run the operation. Ladbrokes PLC is a company under the pump, CEO Richard Glynn isn't making the investors happy and they have just announced even more redundancies at head office. Sources are telling me that Dean Shannon and the current management will remain in charge for the time being but former Sportsbet CEO Matt Tripp is lined up to take over in 2014. Tripp has the canny knack of being in the right place at the right time in the Australian betting industry. Selling the family business No.1 Betting Shop to Sportingbet and moving it to Darwin. Using the profit from that to buy Sportsbet, the original Australian sports bookmaker set up by Bryan Clark back in the 80s, but had then changed hands a few times and was really in poor shape when he came in with a management team buyout, in 2005. Six years later it was a huge business and along came Paddy Power with a huge cheque book to buy the firm. Once the handover done, he then took over as chairman rather than sitting out with no-compete clauses. He left that position earlier in the year with the former CEO of Racing Victoria Ltd, Rob Hines, moving onto the Sportsbet board, so the rumour mill has been working overtime about where Tripp might pop up next.
If it is correct, then it's the biggest goal Ladbrokes have kicked for a long time. Tripp is the Messi of the local industry, if anyone can turn a relatively small, Norfolk Island-licensed online betting operation into something befitting of one of the biggest names in the bookmaking industry, it's him....
This is an interesting entry point for Ladbrokes - it's been well publicised they have been sniffing around looking for a firm to buy into the Aussie market. They looked at the Victorian tote licence, they will have courted Tom Waterhouse, Centrebet and just about every other firm with an Australian licence. Several European firms have looked closely at BetEzy and everyone of them has run for the hills when they've seen the books. Betstar are still holding out - is it really a good idea to refuse the millions being thrown around by international firms? Perhaps Alan Eskander doesn't want to spend the rest of his life on a golf course spending the sale money... Betfred seem to be going it alone in Australia (too late she cried?) and Bwin are still floating around - the market isn't settled yet.
I've heard comments that if Bookmaker.com.au is worth $22m, then Tom Waterhouse went way too cheaply at up to $110m based on performance. I don't necessarily agree - Waterhouse sold his online operation. There is nothing particularly special about his website and his 'success' has been based on very expensive PR campaigns. By all reports, that meant his books weren't in the black. Was there an intricate network of affiliate sites driving significant traffic to his site? Not that I am aware of. The Sydney press lapped up the quotes of the company being worth up to $500m but they were purely fantasy, trying to drive up the price. As George Constanza said "It's only a lie if you don't believe it...". By purchasing Dean Shannon's firm, Ladbrokes can have yet another crack at creating a decent website. Their online results lag further behind their rivals than a four-mile chaser in a 1000m sprint and in the last year they've done deals with Betdaq, Playtech and now Bookmaker.com.au, heavily focusing on the technology. Throw enough darts and one might eventually hit the board....
The big rumour though is who they plan to run the operation. Ladbrokes PLC is a company under the pump, CEO Richard Glynn isn't making the investors happy and they have just announced even more redundancies at head office. Sources are telling me that Dean Shannon and the current management will remain in charge for the time being but former Sportsbet CEO Matt Tripp is lined up to take over in 2014. Tripp has the canny knack of being in the right place at the right time in the Australian betting industry. Selling the family business No.1 Betting Shop to Sportingbet and moving it to Darwin. Using the profit from that to buy Sportsbet, the original Australian sports bookmaker set up by Bryan Clark back in the 80s, but had then changed hands a few times and was really in poor shape when he came in with a management team buyout, in 2005. Six years later it was a huge business and along came Paddy Power with a huge cheque book to buy the firm. Once the handover done, he then took over as chairman rather than sitting out with no-compete clauses. He left that position earlier in the year with the former CEO of Racing Victoria Ltd, Rob Hines, moving onto the Sportsbet board, so the rumour mill has been working overtime about where Tripp might pop up next.
If it is correct, then it's the biggest goal Ladbrokes have kicked for a long time. Tripp is the Messi of the local industry, if anyone can turn a relatively small, Norfolk Island-licensed online betting operation into something befitting of one of the biggest names in the bookmaking industry, it's him....
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