Tabcorp Considers $51 million penalty to exit Sun Bets deal in the United Kingdom

Australian integrated gaming and entertainment firm, Tabcorp Holdings (TAH.AX), on Thursday announced that it would pay Rupert Murdoch’s News UK a penalty of 39.5 million pounds ($51.4 million) to exit their struggling gaming joint venture together with Sun Bets.

The parties which have functioned the UK online wagering and gaming business together since 2016 after having announced their partnership the previous calendar year.

Tabcorp further communicated in the official media release that in the forthcoming days, Sun Bets will “cease trading,” together with the company ’s Chief Executive Officer, David Attenborough (pictured), stating that Sun Bets’ functionality was “under expectations” and that they don’t expect to see that a “material advancement during the next 18 months. ”

The company that manages customer brands, such as TAB, tab.com.au, Luxbet, Sky Racing, Sky Sports Radio, Tabcorp Gambling Solutions (TGS), Keno and Trackside animated racing game, formally declared last month that it intended to opt for an early exit from its joint venture and warned of the probability of a significant penalty for ending premature its arrangement, which was successful through the end of December next year.

Attenborough reasoned, “Even though we didn’t get it directly, we’ve taken valuable learnings from the Sun Bets start-up procedure and operations which will inform our strategy across our portfolio. I would like to admit the Sun Bets team for their efforts in building the company from startup phase. We continue to have a strong relationship with News Corporation. ”

The 55-year-old Attenborough joined Tabcorp in April 2010 as Managing Director — Wagering and then became Managing Director and Chief Executive Officer together with the conclusion of the business ’s demerger of its former casinos company in June 2011.

According to the news release, for the year ended June 30, 2018, Tabcorp expects to record a significant thing of approximately $91 million, post-tax, in respect of Sun Bets in its own financial statements, up from $52 million in the 1H18 financial statements. The amount includes the $51.4 million exit payment to News UK, along with asset impairments. In Fiscal Year 2019, the company is expected to incur further costs related to the closure of as much as approximately $10 million, according to the media release.