n Kelly’s appointment as chairman of Ladbrokes has been described as “ironical” by an informed gambling consultant.

The operator announced last Friday that Kelly would replace Peter Erskine with immediate effect, following confirmation in May that Erskine was to step down from the position.

Kelly is the founder and former chief executive of Gala Coral, which plans to merge with Ladbrokes, and has been at Ladbrokes since becoming a non-executive director and senior independent director in 2010.

He is most renowned for his leadership of the Gala Group and Gala Coral, from when he led the management buy-in from Bass PLC in 1997 to when the wheels fell off and it would become known as the biggest private equity write-off in history.Steve Donoughue

Steve Donoughue, who advised private equity firms on whether or not to invest in Gala Coral following Gala’s acquisition of Coral Eurobet in 2005, thinks that Kelly’s experience in the industry makes him the right man to oversee the Ladbrokes Coral merger, despite problems he encountered in his time at Gala Coral.

Donoughue told Gambling Insider: “There are very few people still alive with such a lengthy and extensive history of involvement in the British gambling industry as John Kelly and yet he is not even 70.

“He is most renowned for his leadership of the Gala Group and Gala Coral, from when he led the management buy-in from Bass PLC in 1997 to when the wheels fell off and it would become known as the biggest private equity write-off in history. So it is a little ironical that he is taking over the chairmanship of Ladbrokes just when it's about to merge with Coral after all the other parts of the indebted conglomeration have been sold off.

“Gala Coral got punished by those tectonic shifts in the industry and the economy which made perfectly sane forecasts suddenly become excessive and all those involved got their fingers burnt and hairstyles trimmed.”

Donoughue also pointed out that Kelly is stepping up to become chairman at a time of uncertainty with regards to the Ladbrokes Coral merger.

He said: “Ladbrokes Coral will make a formidable merger but will it create something greater than its constituent parts? How will the cultures of the two competitors merge? Will the dual branding strategy work?

“There are many unanswered questions about the future of some of our finest bookmakers and John Kelly is one of the best men to be chairing what will be one of the more interesting boardroom tables in the next few years.”

Erskine had been in the position of chairman since 2009 and Ladbrokes said when announcing that he would be stepping down that Kelly would be leading the search to find Erskine’s successor.

The change in chairman follows Jim Mullen’s promotion to CEO earlier this year, as the former managing director of Ladbrokes Digital replaced Richard Glynn in April.