* CMA says 350-400 shop disposals needed for clearance
* Remedies not as onerous as feared
* Ladbrokes shares up 10 pct (Adds Ladbrokes, Coral comment, analyst reaction, shares)
LONDON, May 20 (Reuters) - Bookmakers Ladbrokes andGala Coral will have to sell between 350 and 400 shops to winclearance for their merger, the British competition regulatorsaid on Friday.
In provisional findings, the Competition and MarketsAuthority said a tie-up between the second- and third-largestbookmakers may give rise to competition concerns in a largenumber of local areas.
"In order to resolve these concerns, around 350 to 400 shopsmay have to be sold for the merger to be conditionally cleared,"it said.
Ladbrokes operates 2,154 betting shops in Britain and 77 inNorthern Ireland and Coral operates around 1,850 betting shopsin Britain. The combined group will overtake market leaderWilliam Hill.
Ladbrokes said the CMA's findings were a significant steptowards completing the all-share merger.
"Our focus is to continue working with the CMA to progressthe merger and find a buyer or buyers to deliver the remedies,"a spokesman said.
Gala Coral, which is owned by a group of private equitycompanies including Apollo, Anchorage and Cerberus, also said itwould continue to work with the CMA in order to agree theremedies.
Shares in Ladbrokes rose to 11-week highs after the CMA'sfindings, which were less onerous than some analysts had feared.They were trading up 10 percent at 131 pence at 1027 GMT.
Analysts at Credit Suisse said they had estimated 395 saleswould be required, although there had been forecasts in themarket for significantly higher numbers, ranging from 400 to1,000.
"Many had concerns that the deal would be blocked completelybased on national concerns arising from the expected large shopestate of the combined entity," they said.
Ladbrokes agreed the terms of a 2.3 billion pound all-sharemerger with Coral in July, and shareholders backed the deal inNovember. (Reporting by Paul Sandle; editing by Susan Thomas/RuthPitchford)
