Hornby Lands Job At New Giant Ladbrokes Coral

The former HBOS chief executive Andy Hornby is to land a top management role at the gambling giant which will be formed from the multibillion pound merger of Ladbrokes (LSE: LAD.L - news) and Gala Coral.

Sky News has learnt that Mr Hornby will be named as chief operating officer of the new group - to be called Ladbrokes Coral plc - in what will be his first job for a publicly listed ‎company since the 2008 banking crisis.

Insiders said that Mr Hornby‎ would be handed responsibility for Ladbrokes Coral's vast estate of betting shops as well as its digital operations in the UK.

He will not, however, sit on the main board of the company, in line with its other divisional executives.

The ‎talks between Ladbrokes and Gala Coral are on the verge of completion , with an announcement about a merger agreement possible as early as Friday, the sources added.

The combination of the two companies ‎will create a business with roughly 4000 shops, hundreds of which are likely to have to be sold to satisfy competition authorities.

Rivals such as Paddy Power (LSE: PAP.L - news) and Betfred, as well as private equity firms, are expected to ‎express interest in acquiring the outlets earmarked for sale.

A source said that Jim Mullen, Ladbrokes' new chief executive, will land the top role at the merged company, while his opposite number, Carl Leaver, is likely to remain temporarily to oversee the integration of the two businesses.

The chairmanship of the company will also be held by a Ladbrokes board member - currently Peter Erskine, who had already announced his intention to step down before news of the merger emerged in June.

Paul Bowtell‎, Gala Coral's chief financial officer, has had experience of large corporate mergers in the past - notably at TUI Travel - and will take the same role at Ladbrokes Coral, according to sources.

The chairman of Gala Coral, Rob Templeman‎, is expected to step down once the deal completes.

It is Mr Hornby's role, however, that is likely to attract much of the attention.

After leaving HBOS in the wake of its rescue by Lloyds TSB, he went on to become chief executive of Alliance Boots, joining Gala Coral in 2011.

A respected retailer, ‎he was appointed to run the UK's biggest mortgage lender at the age of just 39.

While he is expected to be criticised in an official probe by financial regulators into HBOS's collapse, many of the most loans on its balance sheet had been made by the time he took over.

This week, board members at the Financial Conduct Authority and Prudential Regulation Authority warned that they could still not set a date for publishing their ‎report, owing to the lengthy legal process required to allow those criticised to respond.

Mr Hornby is also reported to be in line to share in a multimillion pound pot earmarked for senior Gala Coral managers if the deal goes through.

Ladbrokes and Gala Coral, which is owned by a group of hedge funds, are of broadly similar size‎, but their deal could yet founder if competition authorities impose conditions which undermine its financial logic.

The Gala bingo business, which has been up for sale for some time, is expected to be sold within weeks.

Gala Coral and Ladbrokes declined to comment on Thursday.