Newsmaker: Breon Corcoran
Published 07/03/2016 | 02:30
It was the deal of 2015. Betfair's "merger of equals" with Paddy Power has been billed as being as close to the perfect corporate marriage as possible.
Headed by Breon Corcoran, Betfair's online and exchange expertise is supposed to nestle perfectly with Paddy Power's Irish focus and huge retail operation.
And it may well happen. However, after an 75pc share price pop across the two firms before the merger finally closed last month, one can wonder just how much growth is left in the new Paddy Power Betfair.
Mr Corcoran will now have to earn his pay packet. In a sense, the easy part was bringing Betfair and Paddy Power together. The hard work started last month, as he integrates the two firms and drives a company which has doubled in size. The enlarged firm now has to justify what could be seen by some measures as a high share price. For example, according to Bloomberg data, Paddy Power Betfair shares are trading at 37 times earnings. Compare that to William Hill, which is trading at barely half that, with a P/E ratio of only 18.
We'll get a first peek at how the merger is going tomorrow, when the combined companies present their first set of full-year results.
It is very, very, early days for the new firm and, in truth, the actual numbers presented tomorrow will be something of a sideshow. The interesting part will be what detail, if any, we get about the integration process and what we can expect for the months ahead. We know that most of the top team in the "new" firm came from Betfair, but that ex-Paddy Power boss Andy McCue has survived to retain a place as chief operating officer of the merged company.
That is about the extent of it, however. The market will be interested in any tidbits Mr Corcoran reveals, especially with the Cheltenham festival - traditionally the most important week for bookmakers - just around the corner.
Paddy Power Betfair shares are down 8pc since the merger closed and have fallen for the last four days. For Mr Corcoran, the pressure is on to keep delivering.