Date: 14.06.2024

by Adam Dworak

Investors to Seek Compensation from Entain Following Historic Bribery Settlement

Investors in the London-listed gambling giant Entain are set to file a group claim for compensation following the company’s settlement regarding historic bribery cases in Turkey. The law firm Fox Williams has announced its intention to seek over £100 million in compensation for institutional investors, highlighting potential legal and financial repercussions for Entain.

Background of the Case

In November, Entain reached an agreement with the Crown Prosecution Service (CPS) to pay £585 million in a financial penalty and disgorgement of profits. This settlement was related to failings at Headlong Ltd., a subsidiary formerly owned by GVC Holdings, which is now part of Entain.

The bribery cases in Turkey involved significant compliance breaches that have had long-standing impacts on the company’s financial and legal standing.

Fox Williams claims that Entain failed to communicate the CPS investigation to its investors, thereby breaching Sections 90 and 90A of the Financial Services & Market Act 2000. These sections pertain to the company’s obligations to provide timely and accurate information to its shareholders.

The law firm’s statement emphasizes the gravity of this alleged breach, noting, “The claim represents an opportunity for investors in Entain to recover compensation. We urge any eligible investors to participate on this basis.”

Implications for Entain

This claim, if successful, could have substantial implications for Entain, not only financially but also in terms of its reputation and investor relations. The settlement already represents a significant financial outlay, and additional compensation to investors could further impact the company’s financial stability and market perception.

Amidst these legal challenges, Entain has been undertaking strategic initiatives to strengthen its market position and enhance shareholder value. Last month, the company completed a strategic review and decided to retain its core brands. However, it has classified Georgia-facing Crystalbet as non-core and is considering a potential sale, having received interest from several parties.

The strategic review, initiated by the board’s Capital Allocation Committee in January, aimed to evaluate Entain’s extensive portfolio of more than 30 brands. The goal was to optimize the company’s assets and respond to some shareholder criticisms regarding its recent acquisition strategies. This review and the decisions arising from it are crucial for Entain as it seeks to navigate through its current challenges and reinforce its market position.