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What Is The History Of Ladbrokes?

Ladbroke Group operates within the world’s hospitality and regulated gaming industries under the leading brands of Hilton as well as Ladbroke. The group intends to create shareholder value by enhancing cash flow as well as earnings per share and dividends through the use of its strong positions on the international market Both of which are expected to see substantial real growth in the near future.

The story of Ladbroke Group PLC

The time Ladbroke Group PLC was founded over 100 years ago, it was an unassuming agency for the horse racing bets of England’s high society and the wealthy, it has grown from a simple partnership between a trainer and a close friend to become one of the most prestigious businesses in the leisure and hospitality industries. Named after the village located that is located in Warwickshire, England, where it was founded, Ladbroke now consists of Hilton International, the company’s largest division, and is an operator of over 160 Hilton hotels in nearly 50 countries (not counting the United States), and numerous gaming and betting operations that include Ladbroke Racing, the world’s biggest off-track betting businessand race tracks, casinos, and other gambling concerns in and around the United Kingdom, Ireland, Belgium, Gibralter, the United States, Argentina, Puerto Rico, and Peru. In 1996, Ladbroke signed a worldwide alliance with Hilton Hotels Corporation (the owner of the Hilton brand in the United States), a decision that brought back the Hilton brand throughout the world after 32 years of separation.

Purchased by the Cyril Stein-Led Group of Investors in

Because its betting operations were illegal under British law, but it was permitted on an unofficial basis, Ladbroke maintained a very low profile throughout its nearly 70 years. When it moved to west of the city’s West End around the turn of the century, it swiftly became the nation’s top credit-based betting company. In 1957, Ladbroke was bought by an investment group headed by Cyril Stein, who served as chairman until 1993. The legalization of off-track betting in 1963 the size of the Ladbrokes racing subsidiary increased significantly so that it could reach out over the top classes of society to all who wanted to try their luck in picking the winner. In 1967 the company went public, offering shares for sale on the London Stock Exchange, and by 1971 , the firm owned and managed a total of 660 betting establishments throughout the United Kingdom.

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Although its betting operations guaranteed Ladbroke of a fairly steady revenue stream Stein was aware that Ladbroke also needed to build strong assets to provide a foundation for future expansion. By leveraging the experience they’d gained from their experience in the racing industry, Stein and his management team set out on diversification strategies that took the company beyond horse betting to the hotel and property development industries.

Diversified beyond Horse Betting in the 1970s

In 1972, through its acquisition that of London & Leeds Development Corporation, Ladbroke aggressively entered the real estate market with office projects throughout the east of the United States as well as in Paris, Amsterdam, and Brussels. The development of properties within the United Kingdom led to the formation of four other companies: Ladbroke Group Properties, handling commercial and residential projects within the vicinity of London; Ladbroke City & County Land Company which is used to oversee local and out-of-town retail developments; Gable House Properties, the largest operator of nursing and retirement homes in the country that was purchased in 1986 to develop commercial, residential, and retail properties; along with Ladbroke Retail Parks, for the construction of retailing facilities out of London.

Ladbroke started its hospitality business in 1973, when it established three hotels at a moderate cost which quickly grew into an established chain of hotels across the nation. A successful venture and the continued health of Ladbroke’s betting and real estate business made it possible for the company to weather the substantial losses it sustained when it entered the casino industry. Casinos that Ladbroke was hoping would prove to be a lucrative adjunct to its hotel business were abandoned in 1979 after the company was disqualified in a highly publicized case where it was found to be in violation of government gaming laws.

The company expanded internationally in the 1980s.

Five years later, Ladbroke capitalized on an opportunity to expand its racing operations to Belgium. Following the 1984 acquisition Le Tierce S.A., the chain of Belgian betting outlets, Ladbroke rapidly established itself as a prominent player in that country’s racing industry. Though a plan for the purchase of Turf Paradise, an Arizona-based racetrack Turf Paradise racetrack fell through the same year due in part to difficulties in obtaining regulatory approval from the state, Ladbroke successfully acquired the Detroit Race Course at the beginning of 1985 , and took the first step in making its presence felt in U.S. horseracing.

The expansion of the European racing market took place in April of 1986, when Ladbroke was awarded exclusive rights to open betting shops off-track throughout the Netherlands. The year also saw Ladbroke pursue a brand new way to grow in the retailing area by purchasing the Home Charm Group PLC, the leading chain of more than 100 do-it-yourself shops operating across The United Kingdom under the Texas Homecare name.

The company’s growth was driven by acquisitions and expansion in some areas balanced with consolidation and divestitures in other. As part of a strategy that was designed to end involvement in markets where Ladbroke did not have an influential position the company has sold several companies that were part of its Entertainment division during the year 1986 and included Lasky’s, the chain of stores that sell consumer electronics along with bingo halls and amusement arcades as well as local newspaper publishing operations, while retaining more lucrative ventures in magazine production and cable TV.

That accomplished, the company focused its efforts on establishing the most modern and stable image. Ladbroke took a number of steps to change the public’s perception of betting shops off track by introducing snack bars and live television. Ladbroke also joined with three other bookmakers major in 1986 to create Satellite Information Services (SIS), a television communications company established to provide horse and greyhound racing directly to the off-track betting shops in Britain.

The involvement of bookmakers in SIS has prompted an investigation conducted in the department’s Office of Fair Trading (OFT) into potential conflicts of interests. OFT was especially concerned about the bookmakers’ role in an SIS system and their potential for creating an unregulated market, and in their power to shift spectators away from the racecourses towards off-track shops, which could alter the odds that determine the amount of money that bets on winnings will earn. Another investigation was triggered by similar concerns regarding the bookmakers’ power expressed through their National Greyhound Racing Club. Ladbrokes’s stake in SIS and its share in SIS was greater than that of other investors, made it a primary target of the investigation.

At the same time, Ladbroke brought a suit before the High Court in which it accused the Extel communications company of launching a series of false information about the company, which caused a panic on Ladbroke shares, reducing the company’s value at a rate of PS200 million in only two days. Ladbroke asserted that Extel had operated an information service for sports that competed tried to block the first open-market offering SIS shares by simultaneously publishing numerous damaging reports, including an rumor that Cyril Stein had resigned and the implications of improper relationships between prominent racing individuals. The rumors were never substantiated and the OFT investigation did not yield any evidence of wrongdoing on Ladbroke’s part.

It was acquired by Hilton International in 1987

Although Ladbroke was the second largest hotel operator within its own country by the late 1980s, it hadn’t yet earned a global reputation in the hospitality industry. The acquisition of Parkmount Hospitality Corporation and the Dallas-based Rodeway Inn organization to Ramada, Inc. decreased its reach and influence beyond in the United Kingdom. The situation changed when Ladbroke had the opportunity to purchase the 91 hotel Hilton International chain for more than $1 billion from Allegis Corporation. Ladbroke’s bid to purchase Hilton, which beat out many other bidders with hefty amounts it was its second attempt in the space of two years to acquire Hilton’s hotel chains. The first bid was rejected the previous owner of Hilton, Transworld Corporation, turned Ladbroke down to accept an Allegis bid of higher value. The second time, however, Stein used a three-week deadline to force Allegis to accept the Ladbroke bid immediately, instead of waiting for other bidders to get acceptance from the respective governments.

It was the Hilton International purchase made Ladbroke one of the biggest hotel operators worldwide, with presence in 44 countries, including those in the United States where Hilton’s six Vista International hotels joined the Ladbroke fold. (In 1964, Hilton International was split off from Hilton Hotels Corporation, which was the owner of the Hilton trademark in the United States.) The company also received an ownership stake of 50 percent in Hilton’s sophisticated reservation system, which Ladbroke considered to be an important connecting point for travelers from all over the globe. A year later, Ladbroke upgraded and renamed the majority of its hotel properties located in the United Kingdom, reintroducing them as part of the Hilton National chain.

Additionally, technological advancements such as a fully-color, electronic display board and brand new Gold Star shops, with options that appeal to a broader audience have been introduced to help maintain Ladbroke’s status as a leading company in racing and off-track betting. The company’s role as the sole British betting company operating throughout the United States expanded, too: Ladbroke obtained licenses to offer off-track betting across Wyoming and Pennsylvania as well as The Meadows racetrack in Pittsburgh in 1988, and later purchased the San California’s Golden Gate Fields in 1989. Ladbroke also bought a major rival that is based in the United Kingdom, Thomson T-Line and its Vernons football pools operation (which included betting at British professional soccer games), that same year, doubling its stake in betting operations across the United Kingdom.

At the close of the 1980s, Ladbroke’s hotels accounted for the majority of the company’s revenue. After when it was acquired by Hilton Hilton purchase, Ladbroke had opened more than 13 brand new four-star hotels throughout the world and was in the process of development. The company also managed numerous holiday villages and fitness and leisure clubs throughout the United Kingdom, and the Comfort Hotel chain throughout Europe. In the last decade of the 1980s, over 50 new stores were joined to Texas Homecare operation, which was the second largest do-it-yourself store across the United Kingdom with 200 stores. Meanwhile, Ladbroke’s racing business continued strong with more than 1,800 betting shops in all of the United Kingdom.

A renewed focus on Hotels and Betting and Gaming in the 1990s

The 1990s’ early years were challenging times for Ladbroke because Hilton International suffered from the economic downturn in different parts of the world, including Europe and Japan The profits of Texas Homecare decreased due to fierce competition from the DIY industry, and the company’s already troubled U.K. gambling operations were affected further by the launch in November 1994 of the national lottery in the United Kingdom, which particularly affected the Vernons football pools business. The company’s response to the last of these challenges was to constantly explore opportunities abroad to expand its gambling business. In 1993, Ladbroke announced a plan to launch an off-track betting business in Argentina over the next five years. In the month of January, 1995 Ladbroke entered the bingo hall business in Argentina after it took control of the operation of the bingo hall that was located in Buenos Aires. The company was then able to build new bingo rooms located in Posadas in Salta and Salta. Bingo halls were also opened in Sao Paulo, Brazil, in the same time.

The turning point in the company’s fortunes, however began at the beginning of 1994 in which John Jackson was named chairman and Peter George group chief executive, together taking over the chairmanship at Ladbroke from the former CEO, Stein. For the past 37 years, Stein was in charge of the business in a fairly autocratic manner and, despite the company’s status as a public company, had instilled an air of secrecy over the company. Jackson and George not just promised a brand new era of openness and collective management — backed by the announcement in March 1994 that the two men participated in Ladbroke’s first ever press conference, but also quickly refocused the company’s activities. They ordered a series of strategic reviews that were conducted in 1994 and which resulted in a conclusion that Ladbroke should focus its efforts on hotels and gaming , and also divest its retailing and commercial divisions. In the following year, Ladbroke in January 1995 was able to sell Texas Homecare to J. Sainsbury plc for PS290 million. From 1995 until early 1997 Ladbroke slowly sold off nearly all of the assets of its property division, finally closing the division in March 1997.

The result of the company’s new direction was its returning to gambling at casinos more than 14 years after its ignominious exit from the sector in 1979. In September 1994, Ladbroke launched a brand new gaming subsidiary known as Ladbroke Clubs Limited and purchased three London casinos–Maxims, Chesters and the Golden Horseshoe–from City Clubs Limited for PS50 million (US$75 million). Ladbroke was then able to make further steps toward its goal of establishing a broadly based international gaming enterprise. In April of 1996, the Barracuda Casino, another London casino, was acquired from Stakis plc. In July 1997 Ladbroke had signed a letter of intent to purchase Colorado Gaming & Entertainment Co. who owned three casinos in the Colorado town of gambling, Black Hawk and Central City. The deal of US$85 million was the first time that Ladbroke ventured to casinos within the United States. The following months, Ladbroke was awarded a London casino license that would bring its total number of London casinos to five. The same time the company was also in the process of bidding on three licences to operate casinos in South Africa.

In the latter half of 1995 and into 1996, Ladbroke became the subject of takeover rumors when its stock continued fail to perform. The decline in stock performance was partly due to issues with the company’s U.K. betting operations, that continued to suffer huge losses from the national lottery, and by the failure to Ladbroke and Hilton Hotels Corporation to reunite the Hilton brand, something Hilton Hotels was not willing to do. Actually, Hilton Hotels, which along with Ladbroke was also involved in gaming, was one of the companies said to be interested in buying Ladbroke. This was all resolved by the August 1996 announcement that Hilton International and Hilton Hotels formed an alliance to reunite the Hilton brand 32 years after it had been split apart. The alliance agreement has been signed on the 1st of January in 1997 and included Hilton International and Hilton Hotels signing an agreement to collaborate on sales and marketing hospitality development programs and loyalty program and various other operational areas. Ladbroke as well as Hilton Hotels also gained the chance to acquire up 20 percent each of the other’s assets and Hilton Hotels immediately announced that it intended to take a 5 percent stake in Ladbroke. In February the first big initiative in the new alliance, called the Hilton Honors Worldwide loyalty program, was launched.

Also in Feb 1997 Ladbroke Racing acquired the A. R. Dennis chain of 114 betting stores in London and in southeastern England to the tune of PS31.3 million. The purchase boosted that number of Ladbroke Racing betting outlets in the United Kingdom to 1,925.

Following the restructuring of its operations , as well as joining both the Hilton brand, Ladbroke was in a much better position to transform its remaining casino and hotel operations into a better state. With both the gaming and hospitality industries predicted to expand dramatically throughout the 21st century, growth opportunities abounded. Ladbroke’s gambling industry showed particular potential due to its growing global presence. In spite of these positive indicators, the alliance with Hilton Hotels also led to speculation that Hilton Hotels would eventually acquire Ladbroke which would leave the future of the company as an independent entity in doubt.