GVC Holdings PLC (LON:GVC): Following the resignation of Sports Minister Tracey Crouch, the UK government has bowed to pressure to bring forward the reduction in FOBT stake limits, from October 2019 to April 2019. The planned increase in remote gaming duty (from 15% to 21%) will also commence in April. We reduce our FY19 EBITDA by a further £95m and net debt/EBITDA now peaks at 3.0x in FY19. Our FY20 estimates are broadly unchanged.
Parliamentary U-turn
Following the Budget announcement on 29 October and the resignation of Tracey Crouch, the government has brought forward the timing for the FOBT stake reduction. The move from £100 stake to £2 stake will now commence in April 2019 rather than October 2019. The increase in remote gaming duty (from 15% to 21%) will also happen at the same time. A positive by-product is that GVC will likely not be liable for a c £695m (£674m + interest) to former LCL shareholders (from the original M&A agreement), given that legislation will need to be enacted prior to the April implementation of the £2 stakes cut.
To read the entire report Please click on the pdf File Below..