September 2, 2010 by staff
Illinois Lottery, CHICAGO - AP – Two private companies were named as finalists Monday for a lucrative contract, the first of its kind to manage the Illinois lottery and give public presentations on their proposals next week, state officials said.
Still in contention are Lottery Northstar Group – a partnership among the lottery giant GTECH and Scientific Games – and Camelot Illinois, a subsidiary of Canadian company Camelot Group, which runs the lottery in the UK, said Sue Hofer, spokeswoman for the Department Illinois Financial and Professional Regulation.
She did not disclose the names of other companies that bid on the contract, or say how many bids were submitted. She said the final value of the contract to the winning company would only be known once the final details are developed.
Illinois would be the first state to fully privatize the management and marketing of its lottery, a move that the mandate of legislation promoted by Senate President John Cullerton Illinois as a way to help drive revenue and attract new players. The state still retain ownership and regulatory oversight.
The Illinois Lottery has annual sales of more than 2 billion, and education and help fund income and capital projects.
A public hearing is scheduled for next Wednesday, and Gov. Pat Quinn must choose a winner 10-year contract on 15 September.
Northstar already has a presence in Illinois through its partners. GTECH, based in Rhode Island and a subsidiary of Italian-based Lottomatica Group, one of the largest companies in the world of lottery terminals managed by the state lottery. Scientific Games in New York, Illinois offers instant tickets.
“We are very excited about the potential opportunity (in Illinois),” said GTECH spokesman Bob Vincent Monday, adding that the contract of Illinois will be “very special” by allowing a private operator great flexibility to implement and promote the lottery.
GTECH provides a number of at least some lottery services in 25 states, including Illinois, his contract, but the broader contract will be “a bit of a pioneering effort” from Illinois, said.
Illinois plan appears similar to the contract of Camelot has in the United Kingdom, where it controls all aspects of the lottery, except for regulatory oversight.
Camelot Group, owned by the Teachers’ Pension Fund of Ontario, has only one contract in the United States – Advice for California lottery – but sees the growth potential in Illinois Lottery, especially if you allow Internet sales, Illinois Camelot spokesman Jerry Lawrence said.
Hofer and Camelot and Northstar spokesmen would not say how much money the management company could do the contract, and Hofer said it is unclear whether the winner of the Illinois management contract would retain current employees.
The two companies have already submitted plans for how they generate new revenue and running the lottery, and Friday will present proposals for how to pay, “said Hofer.
“It depends on vendors to provide us with their recommendations,” he said. “How to make money may be adjusted depending on how they intend to be paid.”
Officials have previously said the options include the state paying a portion of private manager or lottery sales manager is paid by the state for the right to run the lottery system.
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