IGT and Scientific Games Joint Statement on Brazilian LOTEX Concession
LONDON and LAS VEGAS, Oct. 6, 2020 /PRNewswire/ -- International Game Technology PLC ("IGT") (NYSE: IGT) and Scientific Games Corporation ("Scientific Games") (NASDAQ: SGMS) today released the following joint statement regarding the Exclusive Instant Lottery (LOTEX) concession in Brazil:
"IGT and Scientific Games jointly participated in a bid for the award of the first national instant lottery concession in Brazil ("LOTEX Concession"). The parties were awarded the LOTEX Concession in October 2019. Pursuant to the award, IGT and Scientific Games were required to satisfy certain conditions precedent for the execution of the concession agreement by September 21, 2020. Prior to and since receiving the award of the LOTEX Concession, the parties repeatedly informed the Government of Brazil that it was critical, to ensure the success of the national instant ticket business in Brazil, to have a signed distribution agreement with CAIXA Econômica, operator of the largest lottery retailer network in Brazil. Following more than seven months of diligent discussions with CAIXA, the parties successfully completed contract negotiations. However, despite reaching an agreement on the final version of the contract more than two months ago, CAIXA failed to authorize its execution by the concession deadline, and our request for an extension of the process was not granted. The 13,000 lottery retailers within the CAIXA network are fundamental to a successful launch of the instant ticket business in Brazil and without such distribution network, the companies were not prepared to move forward," said Walter Bugno, IGT EVP New Business and Strategic Initiatives and Michael Conforti, Scientific Games, President Global Strategic Accounts. "In addition, on September 30, 2020, the Supreme Court of Brazil ruled that the federal government's lottery monopoly was unconstitutional, paving the way for states to develop state lotteries for each of Brazil's 26 states and one federal district. As a result, and despite being fully prepared to fulfill all of the financial and non-financial conditions precedent of the concession agreement, prudent capital management dictates that we withdraw from the process and re-evaluate the business case of implementing a lottery operations model in Brazil. Should the Government of Brazil consider an extension of the process for CAIXA to authorize and execute a contract because of the high contribution potential of this venture to a number of government programs, we will explore the possibility of re-engaging in the process."
About IGT
IGT (NYSE:IGT) is the global leader in gaming. We deliver entertaining and responsible gaming experiences for players across all channels and regulated segments, from Gaming Machines and Lotteries to Sports Betting and Digital. Leveraging a wealth of compelling content, substantial investment in innovation, player insights, operational expertise, and leading-edge technology, our solutions deliver unrivaled gaming experiences that engage players and drive growth. We have a well-established local presence and relationships with governments and regulators in more than 100 countries around the world, and create value by adhering to the highest standards of service, integrity, and responsibility. IGT has approximately 12,000 employees. For more information, please visit www.igt.com.
About Scientific Games
Scientific Games Corporation (NASDAQ: SGMS) is a world leader in entertainment offering dynamic games, systems and services for casino, lottery, social gaming, online gaming and sports betting. Scientific Games offers the gaming industry's broadest and most integrated portfolio of game content, advanced systems, cutting-edge platforms and professional services. Committed to responsible gaming, Scientific Games delivers what customers and players value most: trusted security, engaging entertainment content, operating efficiencies and innovative technology. For more information, please visit scientificgames.com.
"IGT and Scientific Games jointly participated in a bid for the award of the first national instant lottery concession in Brazil ("LOTEX Concession"). The parties were awarded the LOTEX Concession in October 2019. Pursuant to the award, IGT and Scientific Games were required to satisfy certain conditions precedent for the execution of the concession agreement by September 21, 2020. Prior to and since receiving the award of the LOTEX Concession, the parties repeatedly informed the Government of Brazil that it was critical, to ensure the success of the national instant ticket business in Brazil, to have a signed distribution agreement with CAIXA Econômica, operator of the largest lottery retailer network in Brazil. Following more than seven months of diligent discussions with CAIXA, the parties successfully completed contract negotiations. However, despite reaching an agreement on the final version of the contract more than two months ago, CAIXA failed to authorize its execution by the concession deadline, and our request for an extension of the process was not granted. The 13,000 lottery retailers within the CAIXA network are fundamental to a successful launch of the instant ticket business in Brazil and without such distribution network, the companies were not prepared to move forward," said Walter Bugno, IGT EVP New Business and Strategic Initiatives and Michael Conforti, Scientific Games, President Global Strategic Accounts. "In addition, on September 30, 2020, the Supreme Court of Brazil ruled that the federal government's lottery monopoly was unconstitutional, paving the way for states to develop state lotteries for each of Brazil's 26 states and one federal district. As a result, and despite being fully prepared to fulfill all of the financial and non-financial conditions precedent of the concession agreement, prudent capital management dictates that we withdraw from the process and re-evaluate the business case of implementing a lottery operations model in Brazil. Should the Government of Brazil consider an extension of the process for CAIXA to authorize and execute a contract because of the high contribution potential of this venture to a number of government programs, we will explore the possibility of re-engaging in the process."
About IGT
IGT (NYSE:IGT) is the global leader in gaming. We deliver entertaining and responsible gaming experiences for players across all channels and regulated segments, from Gaming Machines and Lotteries to Sports Betting and Digital. Leveraging a wealth of compelling content, substantial investment in innovation, player insights, operational expertise, and leading-edge technology, our solutions deliver unrivaled gaming experiences that engage players and drive growth. We have a well-established local presence and relationships with governments and regulators in more than 100 countries around the world, and create value by adhering to the highest standards of service, integrity, and responsibility. IGT has approximately 12,000 employees. For more information, please visit www.igt.com.
About Scientific Games
Scientific Games Corporation (NASDAQ: SGMS) is a world leader in entertainment offering dynamic games, systems and services for casino, lottery, social gaming, online gaming and sports betting. Scientific Games offers the gaming industry's broadest and most integrated portfolio of game content, advanced systems, cutting-edge platforms and professional services. Committed to responsible gaming, Scientific Games delivers what customers and players value most: trusted security, engaging entertainment content, operating efficiencies and innovative technology. For more information, please visit scientificgames.com.
