History and The Start of Ladbrokes
Ladbrokes is perhaps the world's most trusted gambling site. Available in 23 languages and 16 currencies, it offers sports betting, horse racing, financial betting, poker, bingo, and casino from a single login and centralized player bank. Their parent company has been in business since 1886, owns over 2100 brick and mortar UK betting shops, and is publicly-listed on the London Stock Exchange. We will cover their impressive history in depth.
It Began in Ladbroke
Depending upon where you live in the world, the brand name Ladbrokes might seem odd. The name, however, is derived from the village of Ladbroke, located about 2 miles (3.2 km) south of Southam in Warwickshire, England, UK. The founder, W. H. Schwind (nickname: Harry / legal name: Messrs), once lived in the Ladbroke House (now part of the University of North London) and trained horses from Ladbroke Hall, now a listed building (UK's equivalent of what the US calls a Historic Landmark). The third partner of Ladbrokes, Arthur Bendir suggested the name during his first visit upon seeing Ladbroke Hall on a sign post.
The Start of Ladbrokes
Without an official name, the company started in 1886 when a man known only as Pennington went into partnership with Mr. Schwind. The former bet horses were trained by the latter. In 1902, a bookmaker named Arthur Bendir joined the partnership; under the name Ladbrokes, they took on a new model. Rather than just backing horses, they changed their focus to laying them: working as both punters and as a bookmaker. Bendir's vision for the company was to service an elite clientele; with that, he was a big success.
The majority of Ladbrokes' early clients were members of such clubs as the Whites, the Carlton, and the Athenaeum. After moving their offices from Hanover Square to Six Old Burlington Street, Mayfair in 1913, Ladbrokes began focusing on attracting punters from the tracks. In doing so, they recruited a female decedent of a noble Scottish family named Helen Vernet. Extremely unique, she became their on track representative, earning a place in history as the first lady bookmaker. Ms. Vernet became a partner in Ladbrokes in 1918 and spent many years as the face of the company.
Unfortunately for Ladbrokes, between the war and aging partners, business declined greatly in the 1950's. Upon the 1956 death of Vernet, age 80 at the time, the company was sold to Mark Stein (known as Max Parker) and his nephew, Cyril Stein, for £100,000. From here, the history of the company we now know as Ladbrokes began.
The Start of Ladbrokes Plc
When the Stein's took over the business in 1956, most of the clients were upper class members of various gentlemen clubs in Central London. Cyril Stein, however, recognized the need to take on new clients. The laws at the time in the UK restricted cash betting to on course, and all off course bookmaking had to be done on credit. The laws also favored criminals, because gambling debts weren't enforceable. With his hands tied on the off course side, Stein began sponsoring small greyhound tracks with no minimum bet requirements, giving the Ladbrokes name greater exposure in less privileged circles, while still maintaining their privileged class clientele at major tracks. When the UK legalized betting shops in 1961, this strategy paid off.
When betting shops first opened, they were strictly regulated. Windows had to be blacked out: they had strict opening and closing times and didn't take bets on Sundays. However, the ability to bet ante-post for even small stakes attracted bettors from all circles to patronize such shops. At a rate of about 35 new shops opening per week, over 15,000 were available by 1968. Ladbrokes purchased their first shop in 1962, and began using a strategy of investing most of the profits into acquiring more. They became the first retail chain bookmaker in the UK.
Fixed Odds Football
Quite often, articles on the history of gambling sites erroneously credit Ladbrokes as the inventor of fixed odds betting. In reality, well before Ladbrokes, a bookmaker named Charles K. McNeil offered fixed odds on US sports from Chicago in the 1940's. While also credited as the inventor, he likely wasn't the first. Even the claim of creating fixed odds for football (soccer) isn't true. If you read our article on William Hill history, you'll discover that the public record properly refutes such a claim.
In any case, Ladbrokes might possibly have been the first to offer a legal opportunity to wager fixed odds on football using cash post up in the UK. A quite famous story tells of the final Saturday of 1963 when football results cost them over £1 million in a net player win. Enough to crush most of their competitors, this proved barely a hurdle; Ladbrokes would go on to become a multibillion pound Plc.
Ladbrokes Goes Public
In 1967, Ladbrokes owned approximately 100 betting shops and 5 credit offices when they offered 1,350,000 shares for £0.50 per. It turned out that there was £60 million in application orders, making it one of the most oversubscribed IPO's in history, perhaps a testament to the type of clientele and fan base Ladbrokes had attracted over the years. For reasons that will become obvious after reading the next section, no matter what share price was obtained early on, those who held on long-term made a bundle owning Ladbrokes shares.
The rapid expansion of Ladbrokes as a corporate conglomerate could fill another article; however, we'll give a quick run through. In 1972, Ladbrokes acquired London & Leeds Development Corporation through which the company expanded to over 1,100 UK betting shops. Many were more developed than those of the 1960's and had more of a casino-like atmosphere. In 1984, Le Tiercé SA was purchased, giving them ownership of 400 established betting shops in Belgium. Marking their expansion into the United States, in 1985 they purchased Detroit Race Course followed by the purchase of over 100 UK outlets for £200 million in 1987. These are only some of their acquisitions over a 15-year period.
Their biggest coup came in 1988 with the £645 million acquisition of Hilton International, giving them ownership of hotels in all markets other than the United States. This proved to be a worthy investment when they sold back to the Hilton Hotel Corporation in 2005 for £3.3 billion. Even with a cursory overview of the non-gambling related activities of Ladbrokes Plc, you can see that it's no run-of-the-mill bookmaker. On the contrary, it's one of the richest companies in the world, and it grew from an honest betting business founded in 1886, followed by a series of calculated investments.
No doubt Ladbrokes made many smart moves in the 1990's, including one blocked as a monopoly that could have been huge. However, a lot of their breaks in this decade were based on how large and dominate they were in the legal bookmaking business. In 1993, after 37-years running the ship, Cyril Stein retired. The company he initially purchased with his uncle for £100,000 had grown such that issued shares alone had a market value that exceeded £2 billion.
In the year that followed his retirement (1994), the UK national lottery went live and also removed several restrictions that betting shops previously faced. They were now allowed to open on Sundays, display advertisements, market on radio and television, serve food and beverage, and offer slot machines and scratch cards. This change saw the 1,750 betting shops Ladbrokes held in the UK convert into the mini-casino style shops known today. On top of this, they began purchasing actual casinos, the first group of which included City Clubs, and their three casinos: Maxims, Chesters, and the Golden Horseshoe for £50 million.
In 1997, Ladbrokes made a huge acquisition, purchasing their second largest competitor, Coral, for £375 million, which included 800 betting shops. The deal was ruled a monopoly and they were forced to sell the following year. With the proceeds, they acquired Stakis, adding 22 UK casinos and 54 hotels to their list of held assets.
Ladbrokes Goes Online in 2000
In 2000, Ladbrokes expanded its service to the Internet. Due to the massive brand recognition and ability to advertise in well over 2,000 UK betting shops, theirs almost instantly became the UK's most active betting website. Despite being predominately UK, where their brand is as well-known as McDonald's fast food elsewhere, the company was quick to expand to markets unclaimed by other bookmakers.
An early failed attempt at expansion came in 2001 when they partnered with Playboy Magazine to launch a horse race betting website targeted at the United States. There was much talk at the time that the Wire Act would soon be repealed to give the US much-needed tax revenue. Of course a decade later the same conversation is still taking place and the Ladbrokes / Playboy partnership has long since been abandoned. However, while the US expansion proved a costly test, another around the same time paid off with great dividends.
Back in 2001, Ladbrokes was a principle sponsor of the Liverpool FC's 2001-2002 Asian tour that saw them compete in both Thailand and Singapore. The company shortly translated their website into Thai and Chinese, and they began supporting many Asian currencies with banking methods and support available to most of South East Asia. This proved to be a great success, and Ladbrokes is still a popular site for Asian handicap (hang cheng) betting. They also support more football and sport leagues from around the world than any other gambling website.
After their expansion into Asia, Ladbrokes continued to market in their staple, the UK, while expanding to many additional European markets. In 2004, they added a Microgaming powered poker room to their sports and casino platform. As mentioned, today Ladbrokes offers sports betting, horse racing, financial betting, poker, bingo, and casino in 23 languages and 16 currencies.
The company has remained active as a legal global bookmaker. After obtaining French and South African licenses for Ladbrokes.co.za in 2011, in 2012 they obtained a Spanish license as well. The majority of their business is licensed in Gibraltar, a reputable gambling district. If you're looking for one of the safest and most financially secure legal betting websites to patronize, ladbrokes.com is an excellent choice.
Author: Jim Griffin
Updated: March 2015