Brookfield Business Partners to take over lottery business
By Kate Northrop
On Wednesday, American gambling company Scientific Games Corporation announced the sale of its lottery business to Brookfield Business Partners L.P. for $6.05 billion.
According to Scientific Games, the agreement consists of $5.825 billion in cash and an earn-out of up to $225 million based on the achievement of certain EBITDA targets in 2022 and 2023, or earnings before interest, taxes, depreciation, and amortization.
Scientific Games is a leading lottery and international gambling giant that works with about 130 government and non-government lottery entities in over 50 countries. The corporation is best known for providing lotteries with products and services, such as point-of-sale systems, lottery terminals, and scratch-off tickets.
The business is a market leader in instant games and powers approximately 69% of instant product retail sales globally, a press release states.
"The transaction is transformative in accelerating the delivery of our stated strategy to optimize our portfolio, aggressively de-lever our balance sheet and position us to invest in future growth," President and CEO of Scientific Games Barry Cottle said. "We conducted a thorough review of paths to divest the Lottery business, and we are confident that this transaction maximizes value and certainty while minimizing complexity and execution risk, and positions both Scientific Games and SG Lottery for continued success along their unique growth trajectories."
The deal is expected to close in the second quarter of 2022.
"The significant near-term proceeds from this transaction as well as our previously announced sale of Sports Betting will transform our balance sheet and provide the financial flexibility to invest organically and inorganically to accelerate our strategies," Cottle continued. "This marks a major milestone and puts us on a clear path to achieve our vision to become the leading cross-platform global game company and unlock our full value for shareholders."
Brookfield Business Partners is a private equity company that focuses on owning, operating, and investing in a diversified portfolio of industrial, infrastructure services and business services sectors that benefit from barriers to entry or low production costs.
In 2018, Toshiba sold Westinghouse Electric Company to Brookfield Business Partners for $4.6 billion, a nuclear power company that offers services and products to utilities internationally, such as nuclear fuel, service and maintenance, instrumentation, and control and design of nuclear power plants.
"We are thrilled with this outcome and what it means for the future of Scientific Games Lottery and our customers," Chief Executive of Scientific Games Lottery Patrick McHugh said. "I am confident that, with Brookfield's support, we will have flexibility and agility to expand our deep product portfolio to meet our customers' evolving needs and maximize lottery beneficiary proceeds across the globe, enabling us to capture the significant opportunities we see ahead."
Brookfield Business Partners sought to acquire Scientific Games for its strong market position and longstanding international reputation in supplying products and services in technology, which pairs well with its ability to perform well financially in a business that offers high margins and low ongoing capital requirements.
"The Scientific Games Lottery team has built a leading business, which has innovated its industry, at the convergence of games, technology and services, across retail and digital channels for its global customers," Managing Partner at Brookfield Business Partners David Nowak said. "With our capabilities and global reach, we look forward to supporting management in the continued growth of the business."
And this is going to help the players how?
Only players that have SG stock! A few years ago I believe it was SG in GA where they print instant lotto tickets @ a dizzying pace...may have to youtube that one if it is on there.
On a side note sold my IGT about 3 weeks ago. (Now all my 'sin' investments are gone, that being the last one).
too funny 65. 56 is a major key number.
I thought only George Soros, Oprah and Todd had that much money.
I could only wish.
FYI:
Brookfield Business Partners L.P. is a publicly traded limited partnership and the primary public vehicle through which Brookfield Asset Management, its parent company, owns and operates the business services and industrial operations of its private equity group.
Founded: June 2016
Headquarters: Bermuda
Stock price: BBU (NYSE) $48.72
Bermuda, is that part of the USA or Canada? There is a triangle. Anything right with taxation? Are the Arabs in this? Maybe you'll get more <snippers>...
That's a lot of word salad from that guy, translation: " we are going to be very rich" "my kid is getting braces" "we will vacation in the South of France" "New boat, New Car, " Thank you !
No one is putting a gun to anybody's head to buy a ticket.
But that'z a typical statement comin frum SOMEBODY. whooz probably got STOCK investmentz wit SG..eh Texez 2 Stepper?
Exactly, Sully, very well articulated.
"Let me tell you about the very rich. They are different from you and me. They possess and enjoy early, and it does something to them, makes them soft where we are hard, and cynical where we are trustful, in a way that, unless you were born rich, it is very difficult to understand."
--F Scott Fitzgerald
And hence, the mumbo-jumbo from the rich guy.
Only if I was in very dire straits, Buck.
A man has to know his limitations.
This will help the players by using SCIENCE and DATA and probably some MATH in their somewhere too to create more "RNG" type features that cannot never be rigged like a November 2020 election.
I am all for it!! What can go wrong?
Now show me the PCAPS!!!