Pokies Australia

Tatts Group is in talks to buy gaming monitoring firm, Intralot, in a deal which is fueling speculation on bigger deals ahead. (Image: AFP)

Gaming giant, Tatts Group, is eyeing up a deal with gaming monitor, Intralot. The Victorian gaming machine monitoring service also has interests in New Zealand.

The move has fueled speculation that a potential merger between Tatts and Tabcorp is still on the cards.

Intralot services Victoria pokies and gaming terminals and provides key data for use by research companies and regulatory bodies.

Acquisition Fuels Rumours Of Big Guns Merger

While by itself, Tatts’ potential acquisition of Intralot isn’t big news, the timing certainly is. Recently, Tatts’ rival Tabcorp bought out services firm, Intecq. Meanwhile, Tatts sold off its UK pokies wing, Talarius, to gaming giant Novomatic.

Tatts head, Robbie Cooke, was keen to focus on “shareholder value” when pushing ahead with the Talarius sell-off, saying in June that the sale was simply a matter of Novomatic “paying a price”.

However, with Tatts running lotteries and Tabcorp in charge of sportsbetting and gaming, a potential $9 billion tie-up could still be a thing. This comes despite Tatts Group losing their $540 million legal battle over gaming licenses in Victorian hotels and clubs.

Both firms were also celebrating in June when the NT government chose to close a legal loophole allowing offshore betting sites to offer controversial in-running bets.

A merger between the two giants fell through in 2015 after there was a disagreement over valuation. And in April Cooke cited concerns from the competition regulator over the existence of a single entity. The ACCC (Australian Competition and Consumer Commission) had expressed concerns over a bid between the two giants for the WA TAB.

If the ACCC has voiced worries over a relatively small tie-up on one buy-out, a full merger may be even harder to justify.

Merger Can’t Come Sooner For Tabcorp

 If a merger is on the cards still for Tabcorp, it can’t come soon enough. Tabcorp is responsible for horse racing, sportsbetting and keno games in live TAB outlets around Victoria, NSW, Queensland and ACT. It also operates online sportsbook, Luxbet. The Aussie betting company posted annual net profits of $169.7 million this week, marking a 49-percent drop year on year.

That was largely attributed to an expensive gamble on the UK betting market. Tabcorp entered the lucrative regulated British market recently with its SunBets platform. SunBets is now up and running just in time for the start of the 2016/17 English Premier League.

As a result, operating costs for the Aussie betting firm jumped over 2 percent to sit at $378 million for the last financial year. That was, however, a relative drop in the Pacific Ocean for a company that made well over $2.1 billion in revenue.

 As well as a jump in revenue, and good postings for the first half of 2016, Tabcorp also celebrated a new 8-year sponsorship agreement with the Victoria Racing Club last month. 

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