Tabcorp secures exclusive wagering and betting licence in the State of Victoria

Lea Hogg December 18, 2023

Tabcorp Holdings has successfully secured the exclusive tender to operate the Wagering and Betting Licence for the State of Victoria, signaling a transformative moment for the Australian wagering industry.

Tabcorp’s 20-Year Exclusive Deal

The year 2024 is set to witness a modernization initiative by the Victorian government to enhance consumer protections and streamline tax collection from betting duties. Tabcorp, through its flagship TAB brand, will exclusively operate retail wagering and betting in Victorian pubs for a substantial 20-year period, commencing from August 2024 until 2043.

Deal dynamics

Tabcorp will make an upfront payment of AU$ 600 million to the government of Victoria, with fixed premiums of AU$ 30 million beginning in 2025. The deal, estimated at AU$865 million, stands out for its non-inflation-linked yearly premiums. Investors are already anticipating a significant positive impact on Tabcorp’s group financials, with projections indicating a pro-forma uplift of AU$ 140 million if the new licence terms had been applied in FY23.

Corporate strategy lined with State of Victoria licence

Emphasizing the strategic significance of the Victorian licence, Tabcorp’s Group CEO, Adam Rytenskild, highlighted its alignment with the TAB25 corporate strategy. This strategy outlines Tabcorp’s commitment to becoming Australia’s most valued wagering group by 2025.

The exclusive licence empowers Tabcorp to revamp the state’s land-based betting venues, introducing a proprietary wagering platform and an Australian racing media solution.

Legislative changes and joint venture

The new licence brings about legislative changes, including a shift in the point of consumption tax on all betting activities in Victoria, increasing it from 10% to 15%. Additionally, the exclusive deal marks the end of joint venture arrangements between TAB and the Victorian Racing Industry, resulting in reduced fees and taxes for Tabcorp.

Moe in the right direction for evolving wagering market

Dealmakers laud Tabcorp’s successful bid, positioning it for substantial financial gains and strategic advantages in a fiercely competitive wagering landscape.

As the corporate giant sets out to reshape betting experiences in the State of Victoria, all eyes are on the promised returns and innovations under the TAB25 strategy.

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