British gambling company Entain has announced that it has allocated £585 million ($744.5 million) for a potential settlement with the UK tax authorities regarding an investigation into potential bribery offenses at its former Turkish business. The investigation, conducted by HM Revenue and Customs (HMRC), focused on Entain’s former business in Turkey, where the company admitted to historical misconduct involving previous third-party suppliers and ex-employees. Entain, which owns Ladbrokes and Coral betting shops, has been engaged in discussions with the Crown Prosecution Service for a deferred prosecution agreement and is optimistic about reaching a resolution.
The settlement amount, to be paid over four years, will have an impact on the company’s financial performance. Entain’s Chief Finance Officer, Rob Wood, expressed confidence that judicial approval will be obtained in the fourth quarter. Following the news, the company’s shares experienced a decline of up to 3% during morning trading.
The investigation by HMRC, initiated in 2019, examined various former third-party suppliers associated with the processing of online betting and gaming payments in Turkey. Entain, previously known as GVC, divested its Turkish business in 2017. The investigation has also caused difficulties for bookmaker 888, as its license to operate in the UK underwent review by the GB Gambling Commission due to shareholder FS Gaming proposing candidates with previous connections to GVC for executive management positions at 888. These candidates had held senior roles during the period being investigated by authorities.
In a separate announcement, Entain revealed that it anticipates core profit for the year to range between £1 billion and £1.05 billion. This outlook exceeded analysts’ average expectations of around £1.03 billion. The company attributed its positive performance to a 14% increase in net gaming revenue during the first half of the year, largely driven by a record number of online active customers.