LONDON, Nov 19 (Reuters) - British bookmaker Ladbrokes said the rationale for its proposed acquisition of rivalGala Coral was "compelling" in response to opposition from Irishbillionaire shareholder Dermot Desmond.
The two companies agreed an all-share merger in July tocreate a 2.3 billion pound ($3.51 billion) betting group thatwould seek to build on its dominance of Britain's high streetsto expand its online business.
Desmond wrote to fellow shareholders on Tuesday urging themto vote against the deal next week, saying a merger was not theright way to create the new management team needed to build itsonline business.
"Giving away half your company and taking on over 800million pounds of debt is a very expensive way to recruit aquality management team," Desmond said in the letter.
He said Ladbrokes shareholders risked a 66 percent reductionin dividends.
Ladbrokes said it had noted the letter but remainedconfident that shareholders would see the attractions of themerger, including the potential to deliver faster online growth.
($1 = 0.6553 pounds) (Reporting by Paul Sandle; editing by Angus Berwick and JasonNeely)
