GVC waives Turkey sell-off payments
Operator waives €150m sale of Turkish business as Lads Coral takeover should bring in £100m annual synergies
GVC has waived the payment from the sale of its Turkish business to ensure the smooth completion of its £4bn takeover of Ladbrokes Coral.
GVC had agreed to sell the business for €150m in November, with the Turkey-facing operations considered a major sticking point in any potential deal for LCL.
The deal called for the buyer, Ropso Malta Limited, to make monthly payments over a five-year period up to a maximum of €150 million.
However, in the GVC/LCL deal prospectus issued last week, GVC noted it invoked a Clean Break Notice to the buyer before the first payment was made, essential absolving Ropso from future payments.
Instead, GVC will write off a €46m loss on the deal.
A GVC spokesperson told EGR: “Essentially that is the rationale – the earn-out was waived to expedite the deal because the £100m of annualised synergies alone (before other deal benefits are considered) that are estimated to come with Ladbrokes Coral is of far greater value to shareholders.”
Ropso Malta is reportedly backed by individuals that provided IT services to GVC’s Turkish business.
It was incorporated five days before GVC announced the sale of its Turkish assets to the company, according to Maltese company filings seen by Reuters.
Ropso reportedly took control of the Turkey unit for free on 21 December, two days after the disposal had officially completed.