William Hill moves telebetting to Gibraltar
William Hill is moving its telephone betting operation to Gibraltar to save costs.
William Hill is to close its telephone betting subsidiary in the UK in favour of a cost-saving operation in Gibraltar, it announced this morning.
The bookmaker said the move was in response to other betting exchanges and telebetting operators “enjoying significant tax advantages”. It paid £265m in UK taxes and levies in 2009.
The company’s existing telephone betting business made losses of £1.8m in 2009, while it expects a small operating loss in the first half of this year. By moving its telebetting operations offshore to Gibraltar in the last quarter of this year, William Hill anticipates savings of between £4 and £7 million a year in costs and taxes. However, it added the move would cost a one-off cost of £7m. William Hill’s online division was relocated to Gibraltar last year.
William Hill Online, partnered with service provider Vertex, will continue to service all William Hill telephone customers, it said in a statement. Vertex will take over its Sheffield -based call centre, while William Hill’s Leeds operation will close with staff being offered alternative positions.
The new telephone betting business will be run by the company’s online division with customers able to use their telephone betting account for online transactions.
Although William Hill Online is a joint venture with Playtech, future profits or losses from its telebetting business will be retained by William Hill, with the exception of an annual telephone betting support fee of £0.5m payable to Playtech.
Ralph Topping, chief executive of William Hill, said in a statement: “This significant change to our telephone business is a response to the challenge of competing with betting exchanges and offshore telebetting operators, all of whom have benefitted from significant cost and tax advantages over UK bookmakers. This has made it impossible for our existing business to compete profitably from the UK.”
William Hill continues to have a substantial presence in the UK and Ireland, including more than 2,300 licensed betting offices and around 16,000 employees.
EGRmagazine.com reported earlier this month that William Hill saw a 33% decline in telephone net revenues in the first half of this year.