A combination of GVC, which owns online gambling platforms including Partypoker and Sportingbet, and betting-shop operator Ladbrokes Coral could spark even more consolidation in the sector.
So the deal will give, Ladbrokes' investors access to a globally diversified digital gaming business while GVC can expand onto the United Kingdom high street.
The possible offer for Ladbrokes Coral would include 32.7p per share in cash as well as 0.141 GVC shares for each Ladbrokes Coral share.
The merger talks are now on the table only a few months after similar negotiations failed in the summer.
Kenneth Alexander, chief executive of GVC, will take the helm on the merged company if a deal goes ahead.
Under UK regulation, GVC is required, by not later than 5pm on 4 January next year, to either announces its firm intention to make an offer for Ladbrokes Coral or to announce that it does not intend to do so. The value of this would be determined by reference to the outcome of the current review of gaming machines and its estimated impact on the run-rate profitability of Ladbrokes Coral's United Kingdom business.
Now, as the United Kingdom government's ongoing regulatory review continues to cast a shadow over the gambling sector, it would appear that Ladbrokes' management is keen to get a deal done.
The companies had previously held talks about a deal earlier this year but they broke down without agreement.
"Against this it does bring in some geographic risk in GVC notably around Germany following the exit from Turkey, whilst the cash elements, we estimate worth £600m and £800m (max for the triennial review element), are more the comfortable from the existing balance sheet and future cash generation". It started a 12-week consultation to consider cutting the stake to between 50 pounds and 2 pounds, from 100 pounds now.
"This triennial review has run and run and run and with the political climate in the United Kingdom who knows how much longer it may well run for?" he said. Ladbrokes plc is a British-based betting and gambling company.
Following a £2.3 billion merger a year ago between Ladbrokes and Coral, the firm became the UK's biggest High Street bookmaker. A larger company could have a greater competitive advantage versus sector peers.
"The boards believe that a transaction has the potential to create material shareholder value and that there is a compelling strategic rationale for the possible offer", the two said in the statement.
Houlihan Lokey and Investec are advising GVC on the deal, while Ladbrokes Coral is working with Greenhill and UBS.