PaddyPower buys into Australian online wagering market growing at 16% a year
Online wagering in Australia is growing rapidly, and perhaps as much as 16% a year.
Elmer Kuppe, CEO of the Australian gaming behemoth, TabCorp, told a recent Macquarie Equities conference that the company is now taking more than $1billion in wagering bets over the Internet.
In fact the company, which last year set-up an exclusively online wagering business at www.luxbet.com.au, reported Internet wagering turnover of $678.2million in the first half of financial year 2009.
That figure was up 17.5% on the first half of the previous year, and meant that the Internet channel accounted for more than 10% of the value of all the bets wagered at Tabcorp during that time.
The accounts also showed that Internet betting is more popular than phone betting and increasingly so. Total phone betting turnover for the period was up 4.8%, totalling some $523.8million.
Other listed Australian bookmakers too, are reporting strong growth online.
On June 1st, an ASX announcement from Con Kafataris ASX listed company, Centrebet, said it expected its online revenues, to increase by $4.8million in the 2008/9 financial year.
It said that the revenue growth is being “driven predominantly by the 16% growth in the Australian online market.”
Tattersalls, owners of UniTAB and operator of the TAB’s in WA, SA, and the Northern Territory is the second largest gaming business in Australia after TABCorp.
Its most recent half-yearly accounts also showed a strong performance for the online and phone channels.
Indeed at the NT TAB nearly 30% of wagering is done online.
Paddy Power buys in to Australian wagering market
Strong growth in online wagering is no doubt one of the factors that prompted Irish betting company , Paddy Power plc, to buy into the Australian market recently.
Paddy Power is said to be the largest provider of online betting and gaming services in Ireland, and it is also a leading player in the UK market.
Listed on both the Dublin and London Stock Exchanges the company is capitalised at around $A1.5billion.
Its move into the local market started with a takeover of Matthew Tripp’s Sportsbet Pty Ltd.
The deal will see SportsBet getting $48.5million in cash and 100,000 PaddyPower shares in return for a 51% controlling interest.
Paddy Power will pay a further $10million to complete the purchase if Sportsbet meets its earnings target of some $14.6million in the year ending 2009.
Sportsbet’s turnover, most of which is derived from its Internet and phone operations, is forecast at $956million for the year.
Not content with its SportsBet acquisition, Paddy Power has subsequently also announced the takeover of Mark Read’s listed bookmaking company, International All Sports (IAS).
Paddy Power inherited a 19.8% stake in IAS with its Sportsbet takeover and has offered an effective 60c a share or $40million for all the remaining IAS shares.
That price is significantly higher than the 28c per share that Centrebet was offering for IAS earlier this year, and the deal has won the backing of both Read and the IAS Board.
Victorian, Tasmanian TAB / Tote deals
Paddy Powers surprise entry into the Australian market could well have major ramifications for both Victorian and Tasmanian wagering, as both states are in the process of re-licensing their TAB and tote operations respectively.
Paddy Power wasn’t previously considered a likely bidder for either license, and indeed a book being run by IAS on the Victorian license was offering $23 about PaddyPower’s chances.
Tattersalls was the favourite at $2.88 and the Hong Kong Jockey Club second favourite at $3 with incumbent TABCorp languishing as third favourite at $5.
To check the latest odds on the Victorian wagering licence go to
www.iasbet.com.au
For more information go to
www.paddypower.co.uk
www.sportsbet.com.au
www.tabcorp.com.au
www.tattsgroup.com.au
www.iasbet.com.au
www.betsport.com.au
www.centrebet.com.au
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