Tabcorp’s eBet Changes Hands In $41 Million Deal

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As Tabcorp enters a new phase, the Australian gaming company is continuing to restructure its organisation. The Company’s most recent move was the sale of its eBet subsidiary, and it didn’t have to look very far to find a qualified buyer.

The firm announced this week that it had sold its loyalty and tracking systems provider for AU$62 million (US$41.5 million). Frank Makryllos, a former Tabcorp executive, founded Venue Digital Technology Pty Ltd., the company which purchased gaming properties in New South Wales (NSW) and Victoria.

The Lottery Corporation is being split from the firm’s wagering, media, and gaming services branch. It said last month that it was seeking to sell eBet and had a potential buyer in place.

“The divestiture of eBet is in line with our strategy to focus on our core wagering and gaming businesses,” said David Attenborough, Tabcorp’s managing director and CEO. “It will also enable us to reduce debt further.”

This move comes as the Australian Taxation Office (ATO) has ordered the firm to pay AU$40 million in taxes and penalties. The ATO said the Company had incorrectly claimed tax deductions for marketing and promotional expenses between 2009 and 2012.

Tabcorp has been trying to reduce its debt, which stood at AU$3.75 billion (US$2.46 billion) at the end of June. It has also been looking to offload non-core assets, including its Data and Media business, which it sold last year for AU$153 million (US$100.5 million).

In its most recent report on financial health, eBet reported EBITDA (earnings before interest, taxes, depreciation, and amortization) of AU$4.4 million (US$2.92 million). That was for its fiscal year, which ended on June 30. In the second half, it recorded EBITDA of AU$3.2 million (US$2.13 million).

eBet provides technology for tracking customer loyalty and gaming activity in venues. It has a network of over 8,000 terminals in more than 1,200 locations across Australia.

Makryllos said the company plans to “aggressively” grow eBet’s business in Australia and overseas.

“The decision to purchase eBet was easy,” he said. “It is a great business with a strong market position, excellent technology, and an outstanding team.”

Makryllos was previously the managing director of Tabcorp’s wagering and gaming businesses. He left the company in 2012 and founded Venue Digital Technology the following year.

The sale of eBet is subject to regulatory approvals. It is expected to be completed by the end of October.

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