New takeover offer for Gala Bingo

Gala Coral, the company that owns popular online bingo site Gala Bingo has been made an offer by an American private equity firm Apollo to help save it from financial disaster. The equity firm has offered £250 million in exchange of 50% of the company.

Gala Coral is said to be in debt of £2.6 billion and is already in talks with Blackstone who are looking to get a majority stake holding in the company. Apollo’s offer of £250 million, if taken, would certainly help put a dent in the massive debt. Additionally, a group of Gala Coral’s junior lenders have been working to put together a proposal to raise capital whilst keeping the controlling share and according to insiders, this is currently the most favoured option.

Apollo has vast experience in dealing with debt ridden companies and at first glance, would seem to be Gala Coral’s best option. Apollo Equity has dealt with other online gaming companies in the past; they are big shareholders in Harrah's, the Las Vegas operator behind venues such as Caesars Palace. Having said that, dealing with the £2.6 million debt of Gala Coral will involve meticulous, long term planning and thoroughly thought out marketing strategies to overcome the crisis.

If Apollo’s proposal is accepted then the £250 million will go towards buying out the senior lenders of Gala Coral and the junior lenders will be given the balance shares. Apollo will retain the majority shares as well as the voting rights as part of the deal.

The main lenders will make decision over the next few days on the proposal that makes it through and it is hoped that the deal will be completed over the next few months. Gala Coral, however, has ensured that their Gala Bingo members continue to enjoy the same level of excitement on the online bingo site, offering grand promotions and massive bingo jackpots, irrespective of the company’s financial situation.

Written by Anna Richards for Bingostreet – bringing you news from the world of online bingo.