The owner of Ladbrokes and Coral has agreed to pay almost £600m to settle an investigation into alleged bribery at a business it owned in Turkey.

Entain said it had reached an agreement with HM Revenue and Customs which will make the gambling giant pay a total of £585m in the form of a financial penalty and a “disgorgement of profits”.

Under the terms of the agreement, the penalty, which includes an extra £20m charitable donation and a contribution of £10m towards the costs incurred by HMRC and the Crown Prosecution Service (CPS), will be paid in instalments over four years.

“This legacy matter concerns a business which was sold by a former management team six years ago,” said Barry Gibson, the chair of Entain. “The group has changed immeasurably since these events took place.

“We are committed to continuing our journey towards operating only in regulated markets, and are now widely recognised as a best-in-class, responsible operator with the highest levels of corporate governance across all aspects of our business.”

HMRC originally launched an investigation in 2019 into “potential corporate offending” by a Turkish-facing online betting and gaming business that Entain owned between 2011 and 2017, as well as the activities of third-party suppliers and former employees of the group. Entain – formerly known as GVC – is accused of failing to have the correct procedures in place to stop people taking part in bribes that benefit the business.

Entain said in August it was likely to have to pay a substantial penalty to settle the investigation, setting aside £585m.

Entain said it reached, in principle, a deferred prosecution agreement (DPA) with the CPS during a hearing at the royal courts of justice on Friday. It needs final court approval at a hearing to be held on 5 December.

Under a DPA, a company is charged with a criminal offence but the proceedings are automatically suspended if the DPA receives approval from a judge. They must then adhere to strict rules. DPAs have been used in instances of alleged bribery and corruption with companies including the jet engines maker Rolls-Royce.

They are designed to allow a company to make reparations without the collateral damage of a criminal conviction, which could put them out of business.