Tabcorp has been awarded a new Victorian Wagering and Betting Licence for 20 years. The Australian betting company went against corporate bookmakers and came out a winner, an achievement Tabcorp Managing Director and CEO called “momentous.”
Reports initially claimed that Sportsbet placed a higher bid and there was speculation Sportsbet was also considering splitting the licence with Tabcorp. However, it has now been announced that Tabcorp is the sole licence holder.
Tabcorp Will Pay the Same Taxes and Fees as Corporate Bookmakers
Tabcorp’s new Victorian licence starts in August next year. It is a victory for the bookmaker not only because it obtained a new 20-year licence, but also because it is an improvement on the current one and provides the betting company with what it requested – a level playing field with corporate bookmakers in Australia.
Under the new deal, Tabcorp won’t have to fund Victorian racing as it does under the current joint venture arrangement it has with the Victorian racing industry. From now on, Tabcorp will pay the same sports and racing fees and wagering taxes as other bookmakers.
A $132-Million Boost in Earnings Annually
To get the licence, the betting company will first need to pay a licence fee of $600 million in June. After paying for the first year of the betting and wagering concession, Tabcorp will proceed to pay nineteen $30-million payments, one for each year of the licence, starting from August 16, 2025.
The company’s new deal with Victorian racing will result in an annual increase in earnings before interest and tax of $132 million. According to analysts at Jefferies, winning the licence was a “positive outcome” for Tabcorp as losing out to Sportsbet would have been a disaster, while a shared licence would have been a nightmare for both betting operators, with analysts claiming it would have probably been “operationally messy.”
A Strong Licence for the Modern Era
Tabcorp’s CEO and Managing Director Adam Rytenskild was delighted that Tabcorp would finally be on a level playing field with other bookmakers in Victoria. He said the terms of the licence addressed “the structural reform in the modern wagering environment” and would allow the betting operator to “ignite” its wagering business in Victoria.
The Tabcorp chief described the 20-year Victorian wagering concession as “a strong licence for the modern era” and it should be used by other regulators as “the prototype moving forward. Rytenskild added that now that Tabcorp was on a level playing field with other bookmakers, it would use the extra money to invest in more products and a better experience for its customers.
Tabcorp has held the Victoria betting and wagering licence since 1994. After it became clear that it would retain it for another 20 years, Tabcorp’s share value rose from $0.68 to $0.90 per share. Currently, Tabcorp shares are 25% up compared to the previous week and 11.84% up compared to one month ago.
