(Reuters) - Tabcorp Holdings said on Thursday it would pay News UK 39.5 million pounds ($51.4 million) to exit their struggling Sun Bets gaming joint venture.
Sun Bets will cease trading in the coming days, Tabcorp said, adding it expects to record an after-tax charge of about A$91 million ($66.92 million) relating to the exit this fiscal year.
The Australian horse-race gambling house had said last month that it was in talks with News UK to exit Sun Bets.
“The performance of Sun Bets has been below expectations and we do not expect a material improvement over the next 18 months,” Tabcorp’s Chief Executive David Attenborough said.
Tabcorp is expected to incur about A$10 million in other closure-related costs in fiscal 2019.
Last year, Tabcorp announced a strategic review of the business following challenging trading conditions, and reported a larger-than-expected dip in half-yearly profit in February as it struggled with online competition, triggering its biggest daily share price fall in five years.
Reporting by Susan Mathew in Bengaluru; Editing by Gopakumar Warrier and Sunil Nair