GVC denies speculation regarding Turkish investigation as share price falls

By Iqbal Johal

GVC Holdings has rebuffed newspaper speculation connecting an investigation by the British tax authorities into its former Turkish-facing business with defunct payment processor Wirecard.

A column in The Times newspaper published today 30 July, suggested there could be a “convoluted link” to the “Wirecard farrago” and the Her Majesty’s Revenue and Customs (HMRC) investigation of GVC - a theory the paper claims was put forward by investors with short positions in GVC shares.

The Times’ allegations revolve around Kalixa, a payments processing provider that GVC sold in 2017 for €29m ($34m) to Senjō Group, and Wirecard, which collapsed after being caught up in an international financial scandal.

However, GVC denied the claims, reiterating that the HMRC investigation “relates to former third-party payment service providers whose only legacy link to GVC was the provision of services to the Turkish-facing business.”

The statement added: “The board can confirm that it has no evidence of any link between the HMRC investigation and the payment service providers mentioned in the newspaper report.”

The operator confirmed it is fully complying with the investigation and will update the market when appropriate.

On 21 July, it was revealed that HMRC had widened its investigation into GVC’s former Turkish online subsidiary, to examine “potential corporate offending.”

An inquiry was initially launched last November directed at a number of former third-party suppliers relating to the processing of payments for online gambling in Turkey, with no GVC entity subject to the inquiry.

But that expanded, with HMRC referencing section 7 of the Bribery Act 2010. GVC sold its Turkey-based subsidiary Headlong Limited to Ropso Malta Limited in November 2017.

Shares in GVC Holdings fell from 712p ($9.28) at start of trading on Thursday 30 July, to 673.6p at time of writing, a 5% fall.

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