Tabcorp has today (Thursday) executed an agreement to exit its UK-facing Sun Bets joint venture with News UK.
Sun Bets will cease trading in the coming days and Tabcorp will make a payment of £39.5m (€44.2m/$51.4m) in order to exit the venture.
The Sun Bets online wagering and gaming business launched in 2016 under the branding of News UK newspaper title The Sun.
However, the platform has not performed as expected during its short lifetime and reports last month suggested Tabcorp was close to pulling out of the venture.
David Attenborough, managing director and chief executive of Tabcorp, said: “The performance of Sun Bets has been below expectations and we do not expect a material improvement over the next 18 months. As such, we have reached an agreement with News UK to exit the agreement.
“While we didn’t get it right, we have taken valuable learnings from the Sun Bets start-up process and operations which will inform our approach across our portfolio.
“I would like to acknowledge the Sun Bets team for their efforts in building the business from start-up phase.
“We continue to have a strong relationship with News Corporation.”
Today’s confirmation comes after Tabcorp last year said it was to undertake a strategic review of its business after being hit by challenging trading conditions.
In February, Tabcorp also reported a 58.2% drop in first half statutory net profit after tax to Aus$24.6m, while NPAT before significant items also fell 20.2% to Aus$82m.
A spokesperson for News UK said: “The Sun is the No.1 newspaper and digital news brand in the UK and we have launched many successful brand extensions such as Sun Bingo and Dream Team.
“We are increasingly confident in the reach and power of the brand and will firmly remain in the betting and gaming business.
“We now look forward to executing our vision.”
Visitors to the Sun Bets site are now met with a message that reads: “Tabcorp UK Ltd has ceased providing gaming services on behalf of Sun Bets. Please withdraw any funds you may hold with us immediately.”