Entain is on the verge of acquiring NZ TAB, New Zealand’s sports wagering monopoly. The owner of Ladbrokes and Neds now only waits for approval from regulators after winning the race for the biggest betting operator in New Zealand. Entain and the New Zealand wagering monopoly put pen to paper on the deal on Monday.
According to the Australian Financial Review, the NZ TAB deal will allow Entain to acquire and operate the monopoly for 25 years. The length of the agreement was attractive for other wagering giants, with Sportsbet and Tabcorp also expressing an interest. However, the Ladbrokes and Neds owner won the heated battle.
Fighting Offshore Betting Sites
The decision over Entain’s license is expected to come as early as this week and the UK-listed wagering giant will get the green light as soon as it is given ministerial approval.
NZ TAB offers sports betting, as well as wagering on horse and greyhound races. However, the betting operator had problems generating enough revenue recently. It also had to look for help to fight the offshore betting site offensive. In recent years, there have been a lot of international online sportsbooks that have been targeting New Zealand bettors.
NZ TAB had no choice but to accept Entain’s bid, as it anticipated that the increased competition and capital costs would put the wagering business in a bad position.
Entain Will Invest $A930 Million over the Next 5 Years
To secure the NZ TAB rights, Entain promised to invest at least NZD 1 billion (A$930 million) over five years. However, the two companies have not revealed the size of the successful bid.
Entain Australia CEO Dean Shannon said that the company was committed to boosting their initial investment and providing NZD 10 million (A$9.3 million) in racing festivals sponsorship too. Shannon added that they would also finance local community programs to improve the wagering experience of customers, as well as support sports and racing industries.
No Sidestepping of Promises
The great thing about the deal is that it won’t leave any room for Entain to sidestep its promises. If the agreement gets ministerial approval, Racing Minister Kieran McAnulty will make sure that the Ladbrokes owner does indeed invest the money it promised to inject into the racing industry and local communities. McAnulty will also ensure that all 450 TAB employees stay at the company for at least two years.
Another thing that Entain will need to comply with is responsible gambling. It might even be called to assist the New Zealand government with some of the wagering reforms it is planning.
New Zealand is analyzing the effects of geolocation blocking, something that would stop offshore betting sites from accessing the NZ market. If approved, the new legislation will probably go into effect in 2024, and Entain will have to implement it.