Tabcorp is facing a legal-compliance matter related to tax on fees incurred by Tatts Group for the monitoring of gaming machines in New South Wales (NSW). Tabcorp acquired Tatts Group in December 2017. In its financial statement released in June this year, Tabcorp revealed a contingent liability of AU$62m (£34.5m/€37.9m/US$45.9m) after tax concerning this issue. However, an amended assessment now sets the amount at $71.0m, including a penalty interest of $9.0m imposed by the Australian Taxation Office. Tabcorp will report this as a significant item in its first half results for the 2021 financial year. Tabcorp intends to appeal the amended amount, based on the belief that the deductions are allowable. This decision is supported by external professional advice.
Recently, Tabcorp was fined over $30,000 and incurred costs due to a breach of advertising rules in NSW. Liquor & Gaming NSW found that Tabcorp had sent a gambling advert offering bonus bets to a former betting account holder via Instagram Stories on his Instagram account, which violated state law.
In November, there were reports in the Australian media suggesting a potential takeover bid for Tabcorp involving private equity firms and spearheaded by betting pioneer Matthew Tripp. While a few private equity firms approached Tripp to consider launching a takeover bid, one firm offered a fee of $9.0bn for the entire Tabcorp business, and another contemplated a $3.0bn bid for Tabcorp’s TAB betting division. However, Tabcorp has dismissed these reports and has not received any official takeover proposal.
