Playtech in talks to take over Sun Bets contract
London-listed supplier considered the front-runner to replace Tabcorp
Playtech is engaged in detailed discussions with News UK about taking over the Sun Bets contract, EGR understands.
The London-listed supplier was a front-runner to launch the brand before the contract was awarded to Tabcorp back in February 2016 and has thrown its hat back into the ring now Tabcorp is seeking an early exit from the deal.
Playtech and News UK have an existing deal for the provider to run the Sun Bingo brand, and any agreement could see the two products bundled together in one package.
The Sun Bingo brand has also struggled since Playtech took over the contract, with the provider struggling to meet the minimum revenue guarantee (MRG) it owes to News UK.
A source informed of the discussion told EGR: “The wider News UK P&L has the headwinds that you’d expect with declining paper sales and a challenging advertising environment, and they see the gaming channels as a good revenue source for propping up those P&L challenges.
“So when they do a deal it is heavily focussed on MRG so they can bank that money in the P&L. Tabcorp has struggled to meet the MRG, and now anyone coming to the table will be expected to stump up another MRG, and it’s not a small number.
“The questions is, with Sun Bets failure, will they be able to command an MRG from a new sportsbook operator?
“Probably not from the Tier 1’s, while Playtech is well placed to negotiate the tough MRG on bingo by offsetting it against the sportsbook business.”
EGR understands neither Kambi nor SBTech has expressed a significant interest in the contract.
Playtech and News UK declined to comment when contacted by EGR.
Tabcorp said there were no updates on its own efforts to exit the Sun Bets contract, but a source said the Australian firm was “desperate” to get out and willing to pay a significant lump sum to do so.