GVC pledges to fight €200m Greek tax bill
A Sportingbet tax bill issued by Greek officials has hit the share price of GVC and Ladbrokes Coral
The share price of GVC fell by 4% this morning after the operator announced it had been slapped with a €200m legacy tax bill from Greece.
GVC said yesterday it had recieved a tax bill of €186.77m for the historic trading of Sportingbet, a brand the operator acquired in 2013.
The London-listed company confirmed the amount being claimed is a multiple of the revenues the business generated in the country at that time.
The operator added that that ‘multiple other online gaming operators’ were affected, and EGR understands it could be as many as 20.
Analysts from Davy Research believe the Greek tax authorities are using a combination of player winnings and or staking to arrive at the claim.
GVC said it was taking legal advice over the matter, believing it has “strong grounds to appeal the Assessment” in Greek court.
Despite the appeal, the company has decided to enter a scheme with Greek tax authorities where it will pay around €7.8m a month over the next two years so to remain operational in the country.
A GVC statement read: “Entering into such an arrangement is not an admission that the assessment is correct and the Group will seek to recover such payments.”
Ladbrokes Coral’s share price was also down by 3.6% as the news comes in the middle of GVC’s £4bn acquisition of the firm.
LCL said Thursday it had done due diligence on GVC’s international operations at the time the deal was agreed and it “remained confident” in the conclusions reached, despite the tax bill.
Davy Research said: “As long as the Ladbrokes Coral Board are satisfied that this does not materially change things, it should be no more than an unwelcome distraction that will be resolved in the years ahead.”