Tabcorp Holdings, the Australian gaming and wagering company, is asking its retail shareholders to contribute more money to the company before it will know whether or not it will be retaining its two important Victorian gaming licenses after 2012.
Tabcorp is aiming to raise $430 million in order to pay for casino redevelopments that will occur before a planned split of its casino and gaming divisions.
There are differing opinions from analysts on whether splitting the casino and gaming divisions is the right move. Standard & Poor’s warned that the split may cut the company’s credit rating but on Monday, institutional shareholders bought $220 million worth of stock, which accounts for 95% of the offering.
Tabcorp’s retail offer closes on November 10, and due to the coming elections, it looks all but impossible for a decision regarding the renewal of Tabcorp’s wagering and Keno monopolies before the offering closes. The election is set for November 27, and the government goes into caretaker mode on November 2, Melbourne Cup Day. Decisions such as gaming licenses are frozen until a new government has been formed once caretaker mode has been entered into.
The wagering license is worth around $550 million and has been delayed because two of the applicants asked for extensions last month to complete their bids. Tabcorp is competing against Ladbrokes and Tattersalls for this 12-year license. Keno license applications have been with the government for two months but the decision does not seem to be pressing. Tabcorp is up against the Greek company Intralot for this 10-year license. Tattersalls reportedly withdrew its application earlier in the year.
“The extension of time will allow all of the applicants equal opportunity to make their best bid for the multi-million-dollar wagering license,” said Tony Robinson, spokeswoman for the Gaming Minister. “The final applications will be submitted to [government body] Gambling Licenses Review shortly.”