Gambling on an outcome Media Man Australia

Gambling on an outcome, by Michael Feller - 9th April 2009
(Credit: Business Spectator)

The government of NSW has provided further details of its proposed lotteries privatisation, with the State Treasurer Eric Roozendaal announcing the government's intention to offer a long term exclusive licence for lottery distributors, while retaining the brands and intellectual property of NSW Lotteries in state hands.

NSW Lotteries holds seven lottery licences, operating the brands Lotto, OzLotto, Powerball, Lucky Lotteries, Instant Scratchies, Strike Lotto and others.

"Issuing a licence for the operation of NSW Lotteries means public funds can better be directed to priorities such as health, transport and education" Roozendaal said in a public release.

"We believe a sole-distributor model has proven to be the most efficient distribution model for lotteries and is therefore in the best interest of the community."

Advised by a Goldman Sachs JBWere team led by Joe Fayyad, the NSW government has been conducting a strategic review of the NSW Lotteries business, including consultation with newsagency representatives. Feedback from prospective licensees and stakeholders is now being sought.

The government is also being advised by Ernst & Young, mandated to provide tax and accounting support, and lawyers Gilbert + Tobin.

Fayyad was part of the team advising Tattersall's bid for Unitab in 2006, while at Gilbert + Tobin, corporate transactions partner John Williamson-Noble is leading the brief, assisted by Bryan Pointon. Williamson-Noble recently advised on Westpac's $66 billion merger with St George.

The lotteries announcement comes at the same time as the Tasmanian government’s announcement that it would seek to make Tasmania the most competitive wagering tax and licence regime in Australia.

“Tasmania is already highly regarded in the global gaming market, and is well recognised internationally for its probity standards and regulatory framework,” said the state's Treasurer Michael Aird. “The legislation tabled today is necessary in the interests of probity and consumer protection and will enhance Tasmania’s regulatory system even further.”

Aird said the legislation would bring Tote Tasmania under the same regulatory framework as all other gambling providers, subject to the Tasmanian Gaming Commission's oversight. Tote was put on the market in January and is estimated to be worth approximately $100 million. Just as in NSW, Tabcorp and Tatts are expected to be front-runners, but the bidding could acquire some Mediterranean flair with Italian gaming giant Lottomatica and Greece's Intralot also thought to be eyeing the sale.

The NSW announcement also coincides with the state finance and infrastructure minister Joe Tripodi’s 20 day round-the-world odyssey. Tripodi will be beating the drum for the forthcoming NSW power privatisation program and is set to visit China, Hong Kong, Britain, the US, Canada and Europe.

Credit Suisse and Lazard Carnegie Wylie were appointed advisors for the state's semi-privatisation of its electricity assets in late 2007. Ernst & Young are also advising, as are Gilbert + Tobin and Baker & MacKenzie.

Representatives of Credit Suisse and Lazard Carnegie Wylie will be accompanying Tripodi, along with his chief of staff Jennifer Doherty, and the Secretary of Treasury, Michael Schur.

Mark Carnegie and John Wylie, principals of the corporate advisory and private equity firm Lazard Carnegie Wylie, are investors in Business Spectator.

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