Moody’s Ratings has warned that British gaming giant Entain PLC’s credit metrics could deteriorate further than their current level in 2026 due in part to an ongoing legal battle with Australian money laundering watchdog AUSTRAC.
The battle may result in a “material financial obligation”, the agency added as part of a note issued this week concerning Entain’s proposed minimum €800 million (US$1.05 billion) equivalent six-year dual-tranche senior secured notes. Moody’s has assigned the notes a Ba1 rating – meaning the issuer has elements of speculative risk and is subject to significant credit risk – and stated a negative outlook for various Entain entities including Entain Holdings (Gibraltar) Limited and Ladbrokes Group Finance Plc.
“The negative outlook reflects our expectation that Entain’s credit metrics will continue to remain under pressure in 2025 and will start to materially improve only in 2026,” the agency said.
“Additionally, there is a risk that company’s credit metrics and liquidity could further deteriorate because the ongoing AUSTRAC’s legal proceeding could result in a material financial obligation, as well as the minority investors in Entain CEE could choose to exercise a put option after November 2025. A stabilization of the outlook would require improved visibility of such outcomes, in addition to sustained organic EBITDA growth and a positive free cash flow.”
Moody’s noted that Entain continues to suffer from limited cash flow generation due to ongoing payments to the UK’s customs authority HM Revenue and Customs following a €585 million settlement it reached in 2023 following an investigation into alleged bribery at a business it owned in Turkey.
Moody’s also said it expects Entain to reach a settlement with AUSTRAC that will result in additional cash outflow.
AUSTRAC launched legal proceedings against Entain in 2024 alleging systematic breaches of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006. In response, Entain has admitted its AML/CTF program historically had “certain deficiencies” but has disputed a number of specific allegations. It has also pointed to significant improvements made to its internal compliance procedures since. The case is scheduled for a Federal Court hearing on 30 November 2026.
Entain operates sportsbooks Ladbrokes and Neds in Australia, among other smaller offerings.
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