Ontario Liberals Shopping To Sell Profitable OLG


tay
#1
It’s clear Ontarians don’t want, by a very wide margin, their government to divest an asset they see as a money maker,” said Forum president Lorne Bozinoff.








Three major players are officially in the high-stakes game to win Ontario’s prized $3.3-billion-a-year lottery business, the Star has learned.



Rogers Communications, the Ontario Teachers’ Pension Plan, and GTECH-Scientific Games are the only qualified bidders in the now-closed auction for Ontario Lottery and Gaming’s lotto, sources say.



It had been thought Rogers’ main telecommunications rival, Bell, may also make a pitch , but the Canadian corporate giant did not enter the bidding before it closed last month.



Finance Minister Charles Sousa was tight-lipped about the bidders, whose identity is not supposed to be made public until November next year.



“I’m not going to comment on any of them. The proponents are out there doing their work. They have a year. We’ll make a decision in the fall of 2015 — they’re working closely with the OLG,” Sousa said in an interview.



“They’re going to put forward the best bid that they can get. I’m not even getting involved with who they are and where they’re at because then it would be inappropriate to also have that access. We really want to keep this thing independent,” the finance minister said.



“It’s a big play.”



Sousa did say “there’s a lot of interest” in Ontario’s lucrative lottery.



“It is one of the items at OLG . . . that makes money and is a huge dividend to the province.”



Asked if an Ontario-based bidder is preferred, Sousa said: “Again, I’m not going to comment too much on what . . . the parameters or the conditions that are coming forward, but, certainly, the best price is one of them and the best service and ability to deliver the goods — I mean, we want reliability.”



On September 8, OLG issued request-for-proposal (RFP) documents to the three “pre-qualified service providers.”



The winning bid will run the day-to-day operations of Ontario lotteries, which include Lotto 6/49 and a slew of other games.



Industry insiders estimate OLG could make up to 25 per cent more money off the lottery by boosting online and smartphone ticket sales and expanding its customer base.



Given that in 2012-13 the lotto generated $883 million in profits — on revenue of $3.3 billion — the potential windfall is significant.

For a government saddled with a $12.5-billion deficit, signing a contract with a private operator appears to be a gamble worth taking.

OLG’s Tony Bitonti said the Crown agency can say little about the highly competitive bidding war now underway.



“The integrity of the procurement system is such that I cannot comment on how many proponents other than to say that we are in the RFP,” Bitonti said in an interview.



“We are starting the discussions with the proponents in terms of the contract negotiations. Any one of the proponents, we’ll be happy to work with them. Again, the announcement will be made some time in the fall of 2015,” he said.



“What we’re doing is we’re going through discussions with them and working on contracts. There’s a lot of due diligence.”

The would-be lotto operators were all similarly tight-lipped.



“At Teachers’, we don’t comment on transaction speculation or rumours generally and that would be the situation in this case as well,” said Andrew Kondraski, a spokesman for the plan that had $140.8 billion in assets as of last Dec. 31.



Sources say Teachers’ bid is being handled by its subsidiary, Camelot Group, one of the world’s biggest lottery operators.



Camelot runs the U.K. National Lottery, the Irish National Lottery and provides consultancy and management services to the Interprovincial Lottery Corporation of Canada, the New York State Lottery, the Massachusetts State Lottery, the Texas State Lottery, and the Kentucky State Lottery.



Also in the hunt is a joint venture by GTECH, an Italian company formerly known as Lottomatica Group S.p.A., and U.S.-based Scientific Games (SG).



SG spokesman Mollie Cole said from Chicago that “it’s an open procurement process and we’re just not going to comment on it.”

In Italy, GTECH officials did not return repeated messages from the Star.



Even though GTECH and SG compete with one another in some lotto markets, they jointly operate the New Jersey Lottery in partnership with the Ontario Municipal Employees Retirement System (OMERS) under the name Northstar.



At this point, OMERS, which had $65.1 billion in assets as of last Dec. 31, is not involved in the OLG play.



The lone newcomer to the lotto business is Rogers Communications, though the telecom titan’s network of mobile phone, internet, and cable television customers is a potential gold mine for selling lottery tickets, insiders say.



In an email, Rogers’ director of communications Allison Fitton said: “We don’t respond to rumours or speculation.”

Sources say Rogers is expected to partner with an overseas lottery operator if it gets the green light.



While there is much excitement at Queen’s Park over the prospect of new revenue streams, a new poll suggests Ontarians are not sold on selling off the lottery.



The Forum Research survey found 70 per cent of those oppose the scheme while 16 per cent approve and 13 per cent didn’t have an opinion.



“It’s clear Ontarians don’t want, by a very wide margin, their government to divest an asset they see as a money maker,” said Forum president Lorne Bozinoff.



Using interactive voice response phone calls, Forum surveyed 1,079 people on Sept. 30 and Oct. 1 with results considered accurate to within three percentage points 19 times out of 20.




Three bidders vying for Ontario's prized $3.3B lotto | Toronto Star
 
Retired_Can_Soldier
+2 / -1
#2
Let the Harris cuts ahem Wynne cuts begin.

Bend over and take a deep breath, this is just the beginning.
 
grainfedpraiboy
+4
#3  Top Rated Post
Quote: Originally Posted by tay View Post

The lone newcomer to the lotto business is Rogers Communications, though the telecom titan’s network of mobile phone, internet, and cable television customers is a potential gold mine for selling lottery tickets, insiders say.

Here is what society needs, big business, pension funds or foreign companies to try and increase gambling as a source of government revenue.

Now I'm not opposed to gambling or capitalism per say, however half the country is overweight and diabetic thanks to high fructose corn syrup so business can shave a few cents off costs over using real sugar and that crap is now in prit'near everything you eat so given the history of everyone from food to tobacco the fact of the matter is every for profit organisation is going to use all resources available to coerce society into fillings its coffers detriments be damned.
 
tay
+1
#4
I will say if the CONServatives were doing this, the howls would be loud.


Mind you 70% disagree with the sale and the CONS likely wouldn't sell it to a group that has the words Teacher or Union in it but as much as I'm not a gambling fan I don't think this cash cow should go to a private concern...........
 
CDNBear
+1
#5
Quote: Originally Posted by tay View Post

I will say if the CONServatives were doing this, the howls would be loud.

Deafening.

And here we are, none of Mr Wynne's acolytes to be seen or heard from, lolz.
 
Walter
#6
This is a good move by the gubmint. Private industry will be more innovative and make even more money for the gubmint's coffers. Hopefully the LCBO will be next. Who the hell is Lorne Bozinoff.
 
CDNBear
#7
You're being short sighted Walt.

Whoever buys it will still be handcuffed by the law, and still allowed to do things that are illegal in Vegas.

We've heard how profitable the sale of Ontario asset's were supposed to be before. The 407 comes to mind.
 
Walter
#8
Quote: Originally Posted by CDNBear View Post

You're being short sighted Walt.

Whoever buys it will still be handcuffed by the law, and still allowed to do things that are illegal in Vegas.

We've heard how profitable the sale of Ontario asset's were supposed to be before. The 407 comes to mind.

Gubmint should not be in business fer nuthin.
 
CDNBear
+2
#9
Quote: Originally Posted by Walter View Post

Gubmint should not be in business fer nuthin.

I never said it should. The OLG is a cash cow that should stay state run, for the full benefit of the province, not some private firm. Where the province gets a cut .

Other than that, I actually agree with you on the LCBO.
 
SLM
+1
#10
Quote: Originally Posted by grainfedpraiboy View Post

Here is what society needs, big business, pension funds or foreign companies to try and increase gambling as a source of government revenue.

Now I'm not opposed to gambling or capitalism per say, however half the country is overweight and diabetic thanks to high fructose corn syrup so business can shave a few cents off costs over using real sugar and that crap is now in prit'near everything you eat so given the history of everyone from food to tobacco the fact of the matter is every for profit organisation is going to use all resources available to coerce society into fillings its coffers detriments be damned.

You're right and that's one of many areas in which government has dropped the ball, in my opinion. It is governments role to regulate, legislate on behalf of the people in the general best interests of the people.

Quote: Originally Posted by tay View Post

Mind you 70% disagree with the sale and the CONS likely wouldn't sell it to a group that has the words Teacher or Union in it but as much as I'm not a gambling fan I don't think this cash cow should go to a private concern...........

Ordinarily I'd say government should never be in the business of running a business. They're highly inefficient. However, given the special nature of a concern like the OLG, they shouldn't be turning it over to a private concern. Especially given they've not proven themselves particularly good in the last several decades at performing their own role adequately, as mentioned above, in most areas.

Quote: Originally Posted by CDNBear View Post

I never said it should. The OLG is a cash cow that should stay state run, for the full benefit of the province, not some private firm. Where the province gets a cut .

Other than that, I actually agree with you on the LCBO.

LCBO should have been sold a long time ago.
 
Walter
#11
Quote: Originally Posted by CDNBear View Post

I never said it should. The OLG is a cash cow that should stay state run, for the full benefit of the province, not some private firm. Where the province gets a cut .

Other than that, I actually agree with you on the LCBO.

If you read the contract the gubmint will still be receiving at least as much as it takes in now but they won't be running it in gubmint's typical inefficient manner.
 
CDNBear
#12
Quote: Originally Posted by Walter View Post

If you read the contract the gubmint will still be receiving at least as much as it takes in now but they won't be running it in gubmint's typical inefficient manner.

I'm not buying that.
 
Walter
+1
#13
Quote: Originally Posted by CDNBear View Post

I'm not buying that.

Rogers or some other private group will, not to worry.
 
CDNBear
-1
#14
Quote: Originally Posted by Walter View Post

Rogers or some other private group will, not to worry.

lol...

I don't buy that the govt will make more after selling it off.

Innovation isn't strictly a private concept. And any ability of a private company to pay the govt more then it makes now, will come at a cost to the end user.

Either way, the province, being the people, gets the shaft.

The deal is short sighted.
 
petros
+1
#15
When they start selling off Crowns, you know it's going to be a hard, long road back to manageable debt.

The moves Wynne is making are the same moves that failed in SK 30 years ago when debt went off the charts.
 
lone wolf
+1
#16
Quote: Originally Posted by Walter View Post

If you read the contract the gubmint will still be receiving at least as much as it takes in now but they won't be running it in gubmint's typical inefficient manner.

Dunno.... They did that with hydro and now there are around ten thousand complaints about ineptitude and gouging before the Ombudsman
 
petros
#17
Quote: Originally Posted by lone wolf View Post

Dunno.... They did that with hydro and now there are around ten thousand complaints about ineptitude and gouging before the Ombudsman

Just wait until "national grid" upgrade costs hit your bill. Another 25% increase will be welcomed with open arms.
 
Retired_Can_Soldier
+2
#18
Quote: Originally Posted by Walter View Post

This is a good move by the gubmint. Private industry will be more innovative and make even more money for the gubmint's coffers. Hopefully the LCBO will be next. Who the hell is Lorne Bozinoff.

407 brilliant wasn't it.
 
Walter
#19
Quote: Originally Posted by Retired_Can_Soldier View Post

407 brilliant wasn't it.

Nothing to do with OLG.
 
Retired_Can_Soldier
+1
#20
Quote: Originally Posted by Walter View Post

Nothing to do with OLG.

You gave me a red because I said something about Harris cut and slash.

407 was one of those stupid things the Harris government did. Selling a profitable business like OLG is something the Wynne government is doing. Why sell a profitable business?
 
tay
#21
Quote: Originally Posted by Walter View Post

If you read the contract the gubmint will still be receiving at least as much as it takes in now but they won't be running it in gubmint's typical inefficient manner.





If the government will still be receiving as much money when they sell it as they do now, coupled with selling it for Billions.........then I apologize to Ms. Wynne as she is obviously a brilliant negotiator............
 
Walter
#22
Quote: Originally Posted by Retired_Can_Soldier View Post

You gave me a red because I said something about Harris cut and slash.

407 was one of those stupid things the Harris government did. Selling a profitable business like OLG is something the Wynne government is doing. Why sell a profitable business?

Gubmint should not be in business.

Quote: Originally Posted by tay View Post

If the government will still be receiving as much money when they sell it as they do now, coupled with selling it for Billions.........then I apologize to Ms. Wynne as she is obviously a brilliant negotiator............

I'm sure Wynne did all the work.
 
Retired_Can_Soldier
+3
#23
Quote: Originally Posted by Walter View Post

Gubmint should not be in business.

Better to sell off the tax generating business and tax the people directly. Why Walter, I had no idea you were such a socialist.

Quote:

I'm sure Wynne did all the work.

If you could get past your own moronic partisanship it might dawn on you that I wasn't paying the Wynne government a compliment.
 
shadowshiv
+1
#24
This is incredibly stupid. As the article mentions, it is a veritable cash-cow! Why would they want to give that up? Oh, I forgot. It's Wynne. Now it makes perfect sense.
 
tay
#25
The province has scratched a high-stakes scheme to sell off Ontario’s $3.8-billion-a-year lottery business because the prize wasn’t big enough.

But Ontario Lottery and Gaming Corporation, which made the surprise announcement Friday that privatizing the lotto is off the table, will continue with “modernization” that should see players buying tickets on smartphones.

The news came shortly after Premier Kathleen Wynne released the mandate letters for her ministers Friday outlining their “to do” lists leading up to the spring 2018 election.

Wynne’s written directive to Finance Minister Charles Sousa implored him to oversee the “modernization of Ontario’s gaming marketplace to provide more choice and convenience for customers while maintaining a strong commitment to social responsibility.”

After she met with reporters to discuss the mandate letters, OLG revealed it was cancelling the international request for proposals for the lotto business “in favour of a revised modernization approach.”

As first disclosed by the Star in 2014, the Liberal government hoped to reap a cash windfall by selling off the lottery franchise, which includes Lotto 6/49 and numerous other games.

Industry insiders estimated OLG could make up to 25 per cent more money off the lottery by boosting online and smartphone ticket sales and expanding its customer base to a younger demographic.

Rogers Communications, the Ontario Teachers’ Pension Plan — which owns Camelot Group, one of the world’s biggest operators with lotteries in the U.K., Ireland, and several American states — and GTEH-Scientific Games, a joint U.S.-Italian conglomerate, were the only qualified bidders in the auction.

But interest soon began to wane with Rogers abandoning its first lottery venture and it became apparent there wouldn’t be the bonanza Queen’s Park had been anticipating.

https://www.thestar.com/news/queensp...-sell-off.html
 
Machjo
#26
Being in the lottery or alcohol business puts it in a conflict of interest. How can we trust it to take gambling and alcohol addictions seriously when the government itself is the main seller?
 
petros
+1
#27
You are responsible to restrain yourself not the Govt.
 
lone wolf
+2
#28
'cuz it's making money off both of them and you can always trust a crook to feed its own greed first
 
Curious Cdn
#29
Sell the cash cows!

Burn the furniture!

They need money NOW!

They'll tax us for their revenue losses LATER!
 
Machjo
#30
Quote: Originally Posted by lone wolf View Post

'cuz it's making money off both of them and you can always trust a crook to feed its own greed first

Good point. Where else will we get the money for addiction programmes.

Notice how cigarettes are hidden behind the counter but lottery tickets and alcohol are plastered everywhere for all to see.

Common denominator? Cigarettes are not government owned. Thank God for that judging from how lottery and alcohol are advertised.
 

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