Australian racing and wagering giant Tabcorp has emerged victorious in securing the new 20-year Victorian wagering and betting license, surpassing competition from corporate bookmakers. The license, effective from August 2024, introduces a “level playing field” by eliminating the existing joint venture arrangement with the Victorian racing industry. This move positions Tabcorp to pay wagering taxes and racing fees on par with other wagering operators, marking a significant structural reform in the modern wagering environment.
Key Highlights of the License Agreement:
License Duration and Commencement:
The 20-year Victorian wagering and betting license will commence from August 2024, setting the stage for a long-term partnership.
Removal of Joint Venture Arrangement:
Tabcorp’s new license abolishes the previous joint venture arrangement with the Victorian racing industry and associated funding obligations, promoting a more equitable landscape.
Financial Implications for Tabcorp:
Tabcorp will pay a one-off AU$600 million license fee to the Victorian Government on June 28, 2024, along with 19 annual payments of AU$30 million each, starting from August 16, 2025.
The company estimates that, had these conditions been in place earlier, its FY23 Group EBITDA would have been AU$140 million.
CEO’s Perspective:
Tabcorp’s Managing Director and CEO, Adam Rytenskild, lauds the outcome as a positive development for shareholders, the Victorian Government, and industry stakeholders.
The CEO emphasizes the significance of addressing structural reforms in the modern wagering environment and views the new license as instrumental in igniting Tabcorp’s total Victorian wagering business.
Level Playing Field and Value for Shareholders:
The agreement ensures Tabcorp is on a level playing field with competitors in Victoria for the first time, marking a significant shift in the company’s positioning.
The CEO underscores the value for shareholders in the structure of payments, providing the financial flexibility to invest in products, offerings, and customer experience.
Commitment to Responsibility and Innovation:
Tabcorp expresses its commitment to a safer wagering ecosystem, particularly in the face of increased online bookmakers licensed in the Northern Territory.
The company vows to continue working closely with the Victorian Government and Regulator to prioritize customer safety and evolve capabilities to prevent the impact of gambling harm.
Tabcorp’s securing of the 20-year Victorian wagering license heralds a new era for the company, marked by structural reforms, financial prudence, and a commitment to a safer and more innovative wagering landscape. As Tabcorp steps into this long-term partnership, it aims to continue contributing to the social fabric of local communities in Victoria while ensuring the sustainability of the state’s racing industry.