Betting chain Ladbrokes (LON:LAD) announced this morning plans to merge with Gala Coral, in a deal that will make the combined chain the biggest bookmaker on the high street.

Adding Coral’s 1,845 shops to Ladbrokes’ 2,100 will mean the chain will overtake the current market leader, William Hill.

The business is expected to be valued at £2.3bn, and the deal will be funded by offering 93 million new shares to investors.

Peter Erskine, chairman of Ladbrokes, said the merger was a “major strategic step for Ladbrokes”.

He added: “Together, we will create a leading betting and gaming business. The transaction will provide an attractive opportunity to generate considerable value for both sets of shareholders.”

Ladbrokes is currently trading down 2.57% at the news.