$11 billion Tabcorp merger to go ahead
The long-awaited Tabcorp-Tatts mega-merger is finally going ahead after it got the approval from shareholders.
More than 98 per cent of Tatts investors voted $11 billion merger at the wagering and lotteries company's scheme of arrangement meeting in Brisbane on Tuesday afternoon.
The vote gives Tatts shareholders 58 per cent of the combined group.
It will have pro-forma annual revenue of at least $5 billion and earnings before interest and tax, depreciation and amortisation of $915 million.
The deal will be implemented on December 22 after receiving approval from various government and regulatory authorities.
Tatts chief executive Robbie Cooke told the company’s annual general meeting that afternoon that the combined group would be in a good position to compete in the Australian market, where it will face fierce competition from mostly foreign-owned corporate bookmakers, while pursuing growth opportunities overseas.
"I know the combination with Tabcorp is absolutely the right next step to enable our company to compete in what is an ever-consolidating global gambling marketplace. Scale, together with the operational diversity offered by having wagering, lotteries, and gaming businesses under one ownership ... will well position the combined group to compete in the future," Mr Cooke said.
Tabcorp chair Paula Dwyer said the focus was now on bringing in nationally consistent digital-betting taxes on its foreign bookmaker competitors.
She said 15 per cent "point-of-consumption taxes" which is seeing revenue on digital betting losses being taxed for the first time was just one step.
She said this now needs be "harmonised" across the board.
"We believe it should be harmonised," Ms Dwyer told shareholders. "We don't want to create opportunities to have efficiences between the states exploited."
Tabcorp and Tatts have to pay much higher taxes than the online bookmakers, licensed in the Northern Territory so Tabcorp has made the case that point-of-consumption taxes are needed to "level the playing field" in the gambling industry.
by Leon Gettler, December 19th 2017
