|Online casino and gaming company 32Red, which sponsors Aston Villa football club, has admitted that its profits have crashed so drastically that it is now in breach of the terms of its loan arrangements with Royal Bank of Scotland (RBS).|
The crisis stems from the June takeover of loss-making sports betting business Bet Direct, which was hit by a disastrous run of horseracing results in October and November.
The company warned that profits for the year will now fall 'significantly below' market expectations, and that the company is in talks with staff to move its Bet Direct operations to Gibraltar in the hope of improving profitability.
32Red dismissed rumours that RBS may be about to terminate their agreement by stressing its relationship with its bankers remains 'constructive'. The company owes RBS £6m but has a cash balance of £5.3m.
Shares in 32Red halved to 27½p within minutes of the start of trading today.