Intralot Keeps Eyes On Lucrative Lottery Prizes

Intralot's joint venture Inteltek is poised to continue to operate Turkish sports betting game Iddaa after a tender conducted this week, but the Greek company already has its eyes set on further expansion in key lottery markets across the Atlantic.
The Turkish lottery’s fixed-odds sports betting game Iddaa did not allow players to bet on the outcome of its own recently concluded management tender; but if it did, then the incumber Intralot/Turkcell joint venture Inteltek would surely have been the runaway favourite.

Jaws hardly dropped in the gaming industry when Inteltek was all but confirmed on Thursday as the winner of a new 10-year contract to operate the lucrative Iddaa game, especially given that the group had already experience in managing the game and that the tender was only opened after a legal challenge by Intralot’s rival GTech saw a Turkish court annul Inteltek’s existing contract the run the lottery.

However, in order to triumph over GTech/Lottomatica’s bid, Intralot’s Inteltek had to cut its take of Iddaa revenues to an eyecatchingly low 1.4 percent from the 7 percent share the venture currently takes home from the game.

As GamblingCompliance reported this week, the venture between Lottomatica, Italian betting operator SNAI and a local media company had come under particularly close scrutiny on the part of the Turkish authorities, which even asked Italy’s gaming regulator to confirm the group’s eligibility in terms of meeting the tender’s requirements.

The Italian/Turkish group had proposed to take a 2.1 percent share of the revenues in its own bid.  

A third participant involving UK betting company Ladbrokes also missed out on the Iddaa contract, while a proposed tie-up between Gala Coral and US lottery giant Scientific Games declined to enter the bidding.

So, no real surprises in the continuation of Intralot’s Turkish presence, but interim results released this morning reveal the company can certainly take delight in progress made in other markets in recent months.

Intralot’s reported first-half revenues of nearly 550 million euros were up 45 percent on the same period in 2007, accompanied by a more modest 5 percent rise in EBITDA to 127 million euros.

Arguably top of the company’s achievements, at least in terms of its core lottery business: a significant breakthrough in the US market, where in April Intralot was awarded a management contract for the Ohio State Lottery from under the nose of incumbent operator GTech.

Intralot’s US lottery operations to date have been with smaller states such as Nebraska and Montana, plus newly inked contracts in New Mexico and South Carolina.  

Indeed, GTech had believed it had little reason to fear the Greeks in Ohio as Intralot’s lack of experience in managing a key US state lottery would likely count against it in a state with the US’s ninth largest lottery.

After losing out to Intralot, GTech even filed a 35-page complaint, alleging serious flaws in the Ohio tender and claiming its bid had been misrepresented. But with future US lottery tenders ahead, the Ohio deal is a significant one for the Greek company.

Intralot says it intends to now capitalize on its recent victories in Ohio and Turkey, and will be expected to do battle with GTech and Scientific Games for further lottery contracts in Americas North and South over the coming months.

The Athens-based firm lost out to rival GTech in the Southern Hemisphere earlier this week, when it was reported that GTech will take over as IT supplier to the Chilean lottery upon expiry of Intralot’s current contract later this year.

Intralot has been active in Chile since 2001, but is also known to be eyeing potential opportunities across the Andes in Argentina and Brazil.

The reawarding of the Iddaa contract will leave it well poised for further expansion.

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