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Entain chair purchases 9,000 additional company shares

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Barry Gibson, chair of Entain, has purchased 9,000 company shares, bringing his total shareholding to 132,500.

The share purchase took place yesterday (6 December), just under a month since Gibson and chief executive Jette Nygaard-Andersen increased their shareholdings in the company. At that time, Gibson purchased 93,664 shares in Entain, bringing his then-total to 123,500. Nygaard-Andersen purchased 35,000 shares, bringing her total to 65,381.

This comes days after Entain reached a final Deferred Prosecution Agreement (DPA) with the Crown Prosecution Service (CPS) regarding historic activities in Turkey.

The terms of the DPA – which were announced on 24 November – will see Entain pay a financial penalty and disgorgement of profits to a total of £585.5m. The business will also make a £20m charitable donation, and contribute £10m to HMRC and CPS costs.

Speaking after the DPA was agreed, Gibson said Entain would now be able to focus on the future.

“This is the final step in a process that has hung over our business since HMRC launched its investigation into a business that was sold by a former management team six years ago,” said Gibson. “We have cooperated extensively and proactively at every stage of the process which, I am pleased to say, has been recognised by the court.

“Entain has now fundamentally and profoundly changed.  We can now concentrate on the future.”

Winding road to investigation

Reaching the DPA officially ends HMRC’s investigation into activities allegedly carried out by Entain’s former Turkey-facing business Headlong Limited, which it sold in 2017.

His Majesty’s Revenue and Customs (HMRC) issued Entain – then called GVC Holdings – with a production order in November 2019. This aimed to gather additional information from Entain regarding online betting and gaming operations. The investigation focused on alleged breaches of Section 7 of the 2010 Bribery Act.

Entain denied claims that it continued to benefit from Headlong Limited in 2019. In 2020, Entain confirmed that it was officially under investigation by HMRC regarding “potential corporate offending”.

In May this year, Entain said it may face a “substantial” penalty in relation to the investigation. And in August, it set aside a £585m provision in preparation for the DPA approval.

Change afoot at Entain

The lead up to the DPA has been full of ups and downs for Entain. In November, Goldman Sachs downgraded the company from the status of “buy” to “sell”. The financial services giant said this was due to Entain’s growth in recent months.

This was despite Entain reporting a net gaming revenue increase of 7% for its third quarter and a revenue increase of 9%.

Ahead of the DPA finalisation, Entain made significant moves in the M&A sphere. In October, it finalised its acquisition of Angstrom Sports. The deal was valued at £203.0m.

The company’s CEE subsidiary, Entain CEE, announced that it would acquire Polish sportsbook operator STS Holding for £750m in June. The deal was approved by 99.3% of STS investors and closed in August.

But also in August, Entain confirmed that it had “axed more than 50” jobs in its Australian business. Issues also arose for its esports offering Unikrn, with Entain revealing that it would scale back B2C operations in the business as part of a repositioning.

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