Playtech announces two JVs following Sciplay "restructure"
Joint ventures with Merkur and Peermont Group mark software provider's first move into German and South African markets.
Playtech has signed two new joint ventures following today’s confirmation its US partnership with US lottery supplier Scientific Games has been reduced to a “non-exclusive” strategic partnership.
Yesterday eGaming Review exclusively revealed that the partnership was to be restructured, confirmed in a statement released this morning. The companies will continue to work together, but on a “non-exclusive basis.”
The reworked agreement effectively shuts down Sciplay as the entity through which Playtech and Scientific Games collaborated under the terms of the original deal, signed in January 2010. The deal was designed to give Playtech the opportunity to license its software to Scientific Games’ 120 state gaming providers, and target government lottery contracts. All Sciplay-related entities, including the free-play poker site Calshark.com, will be placed under Scientific Games’ ownership.
In the wake of the announcement, Playtech has announced the signing of joint ventures in South Africa and Germany, allowing it to build a presence in these markets.
The Israeli company has agreed a deal with Peermont Group, one of South Africa’s largest gaming and hospitality businesses. The 50:50 JV has been signed ahead of expected changes to the country’s online gaming regulations, and will see Playtech supply Peermont with sports betting software, most likely through Geneity, the acquisition of which was announced today, and eventually a wider range of technology following changes in regulation; currently only sports betting is permitted in the market.
Under the terms of the deal, the companies have signed a separate software licensing agreement to supply gaming technology and player management systems to Peermont, which will apply for a sports betting licence, aiming to launch this year in order to develop a presence in the market ahead of future regulatory developments.
Playtech has also announced the signing of an agreement with Merkur Interactive GmbH, the online subsidiary of German land-based gaming company Gauselmann Group.
Merkur will own 50.01% of the JV, though each company will have equal board representation. The deal is expected to be a long-term relationship with no transfers of ownership permitted until 2019. It has been formed ahead of expected revisions to German gaming regulation, offering gaming and sports betting services “where permitted.”
In a statement announcing the deal, Playtech and Merkur revealed the JV entity would apply for licences “dependent upon each territory and gaming activity.”
This follows an announcement by 15 Länder in December last year, in which the states announced their intention to sign a state treaty allowing up to 20 licensed sportsbook operators based on a 20% gross profits tax. Schleswig-Holstein passed a separate law allowing the issue of unlimited sportsbook, casino, poker and exchange licenses, based on a 20% gross profit tax, in the northern state.
Playtech CEO Mor Weizer admitted that while the eventual regulatory structure remained unclear, the JV would allow the company to take advantage of developments as and when they occur: “Gauselmann and their Merkur brand are universally renowned throughout Germany and will provide a fantastic springboard for the business once regulations permit online activity. While the regulatory and fiscal environment remains uncertain, it is clear that a partnership between Playtech and Gauselmann can deliver a combination of market leading capabilities which has the potential to achieve a significant market share, however the market regulation develops.”