To Acquire South Australian TAB
Document date:
Wed 15 Aug 2001
Published:
Wed 15 Aug 2001 00:00:00
Document No:
141936
Document part:
A
Market Flag:
Y
Classification:
TAB QUEENSLAND LIMITED 2001-08-15 ASX-SIGNAL-G HOMEX - Brisbane +++++++++++++++++++++++++ TAB Queensland Limited (TABQ) is to acquire the South Australian TAB (SATAB) in January 2002. The sale of the South Australian business was finalised when agreements were executed between TABQ, the South Australian Government, and the South Australian Racing Industry today. The sale is conditional upon ACCC and other regulatory approvals being obtained. TABQ will receive a 99 year off-course totalisator licence, with a 15 year exclusivity. The new business will also be able to conduct fixed price sports betting under similar arrangements. The price paid to the Government is $43.5 million. A wagering tax of 6% plus GST will be applied to wagering revenue. South Australian Racing will receive 39% of the commission revenue from race wagering. An arrangement between TABQ and the Government will ensure that SA Racing receives $42 million indexed over three years commencing July 2001. SATAB generates betting sales in excess of $600 million annually from 380 retail outlets throughout South Australia, and a telephone betting centre in Adelaide. SATAB's betting pools will be joined with the Queensland and Northern Territory pools in January, to produce annual sales in excess of $2.2 billion. This will represent 23% of the national off-course totalisator market. SATAB is expected to generate annual revenues of near $100 million, and is expected to be earnings per share positive within the first year of operation. The new business will be operated through a subsidiary to be named, 'SATAB Pty Ltd'. The new company will be urging the vast majority of staff to continue their employment with SATAB. The acquisition will be funded from TABQ's existing cash holdings, and debt. For further comment, please contact Dick McIlwain, Managing Director and Chief Executive, TAB Queensland Limited - Ph: 0408 714 742. R M Cooke GENERAL COUNSEL AND STRATEGIST 1