Management at GVC (GVC) has encountered an unwelcome distraction from its takeover bid for Ladbrokes Coral (LCL). The gambling company has been hit with a €187m (£164m) tax bill from Greek authorities related to a subsidiary business previously owned by Sportingbet for a tax audit, prior to GVC's acquisition of the business in 2013. GVC is planning to appeal the charge, and would take it in €7.8m monthly instalments over two years should it have to pay.
Analysts at Peel Hunt said the tax bill makes “no sense” and “highlights that GVC is in a better balance sheet position than Greece”, but believe the payments could be “comfortably borne” by the group. Pre-tax profits are expected to be €200m when GVC reports its results for the year to December 2017 – precisely the amount set aside as provision.
