Following the 2021 announcement of Tabcorp about a planned spin-off of its profitable lotteries business, the Australian gambling giant has now revealed that the demerger of its Keno and Lotteries business moved one step closer thanks to the Supreme Court of the state of New South Wales (NSW) that ruled in favour of a shareholder vote on the proposal.
Under the NSW Supreme Court’s rulings, Tabcorp is required to organise a shareholder meeting and hold a vote on a proposed scheme of arrangement for the proposed spin-off. The company already has a general meeting scheduled for May 12th, 2022, so the aforementioned scheme is set to be carried out on the same exact date.
As Casino Guardian reported at the time, the spin-off of the Australian gambling operator’s successful lotteries business was originally proposed in July 2021, after the company held a comprehensive strategic review of its relevant ownership and structural options, as it is willing to boost its shareholder value to a maximum.
The demerger will result in the establishment of two standalone businesses, both of which are set to be listed on the Australian Securities Exchange (ASX). Each of the businesses would also feature its own profiles, strategies and opportunities for further growth, with the spin-off expected to create shareholder value by allowing investors to value each business.
Independent Expert Also Recommends Lotteries and Keno Unit Demerger
The lotteries and keno business of Tabcorp has been licensed to offer its services in all states and territories of the country except for Western Australia. The unit will be seeking to obtain an investment-grade credit rating. The gambling and betting giant has a preliminary agreement with holders of the US Private Placement notes, which would allow the keno and lotteries business to be allocated as of the date of the spin-off.
The gaming, wagering and media services of Tabcorp that are currently offered in the wagering and gaming unit of Tabcorp and include the Australian omnichannel betting company TAB, the sports broadcasting asset Sky, MAX – the largest gaming services provider in Australia, and the company’s businesses in Europe and the US, will be targeting credit metrics involving an investment-grade credit profile.
Tabcorp’s Board of Directors unanimously recommended the spin-off to the Australian gambling giant’s shareholders, ahead of the planned meeting. The company’s directors also recommended a vote in favour of the capital reduction that is set to be included as an issue at the general meeting on May 12th.
An independent expert, Grant Samuel, had been appointed by Tabcorp to review the spin-off. Mr Samuel also confirmed that the demerger would be the move in the best interest of the Australian gambling operator’s shareholders.
Tabcorp announced that it will unveil the entire information associated with the demerger via a special booklet that will be received by its investors on or before April 8th, 2022, as it needs to be registered with the Australian Securities Exchange first. The general and scheme meeting are set to take place one after the other in Sydney, with the company’s shareholders also given the opportunity to attend the meetings via an online meeting platform.
- Author
Olivia Cole
