| Rank to Release Statement over VAT Reclaim |
| Written by Mark Bennett |
| Saturday, 09 April 2011 07:45 |
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Rank the parent company of Mecca Bingo and Grosvenor Casinos is expected to release a statement which is likely to contain details in relation to its recent victory over Her Majesty’s Revenue & Customs (HMRC). HMRC will appeal against the decision, which has seen the Mecca Brand alone to get a VAT refund totalling £74.8m, which including overpaid VAT on games of bingo from 1973 to 1996. In addition the HMRC paid them interest of £79.5m. It is not known whether Rank will invest the funds in further acquisitions or if it will look to make a payment to shareholders. Peel Hunt estimates that – subject to HMRC being unsuccessful in its appeal - Rank should have a cash surplus of over £40m by the end of 2011, wiping out around £110m of net debt. “If it does pursue acquisitions we believe these are most likely to be in the areas of online gaming and casinos. Management has thus far been cautious and we do not expect it to embark on a reckless acquisition programme,” said analyst Nick Batram.
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