Top online gambling operator Playtech paves the way for a return to the US market with a new partner that will open many doors.
With the signing of a deal with US lottery services provider, Scientific Games, Playtech has completed what is a significant move into the huge global lottery market. In the process they have gained access to important US government contracts, while boosting the Videobet machines side of their business.
The deal also enables the online gambling software provider to take full advantage of growth plans set out by many state lottery operators. It is these same lottery operators who need online gambling sectors such as online poker, casinos and bingo to remain competitive as the US government begins the process for legislation to legalize and control online gambling.
With customers including the UK’s Camelot, the Chinese government, many South American states and governments in Asia and the Far East, Scientific Games is currently one of the largest lottery systems suppliers in the world.
Most importantly from the perspective of Playtech, Scientific Games is also a supplier of lottery systems in no less than thirty one US jurisdictions. This gives Playtech a way back into the market it vacated in 2006 when the US government closed the doors on online gambling with the introduction of the UIGEA. Assuming that the current push by leading senators for the regulation of online gambling is successful, this will secure their position providing a great opportunity to occupy a dominant place in the US market.
The two companies will also work side by side to deliver existing contracts to supply the US company’s video betting terminals. The immediate spin off benefit for Playtech resulting from this contract is the installation of around 13,500 Videobet betting terminals in betting shops throughout the UK.
As a direct result of the announcement of the deal, shares in Playtech Plc rose 18 percent to close at 515p on Friday. This restores their shares to August 2008 levels and gives it a £1.2bn ($2bn) market capitalisation, which is near to the record £1.3bn May 2008 valuation.
This latest joint venture follows the Playtech and William Hill partnership made in October 2008 which came about to develop online operations for the bookmaker.