Woolworths Pokies
Jul 02, 2019 Woolworths is set to cut and run from its poker machine business, announcing plans to combine its drinks and gambling arms into a separate venture which it will offload. The Woolworths Group proclaims it celebrates “family-friendly values”. Within its supermarkets the company has sought to demonstrate this commitment. Woolworths and pokies Following the speech by Senator Nick Xenophon about the pokies crisis, it is timely to consider whether corporate responsibility to the community or to shareholders can be achieved simultaneously by Woolworths Limited. .Woolworths' most influential shareholders, Perpetual Investments, which has told the company's board it should ditch its pokie machines. The investment powerhouse, which manages a $27.4 billion portfolio, had repeatedly told the Woolworths board that pokie machines are incompatible with the supermarket's expressed values and were a threat to.
WOOLWORTHS has emerged as a potential big winner after the Victorian Government smashed the pokie machine duopoly between Tabcorp and Tatts.
Shares in Tabcorp and Tattersalls were placed in a trading halt yesterday after the announcement that they will lose their control over the state's 27,500 poker machines in 2012.
Experts say that since Woolworths owns so many pubs and bars in Victoria, it is perfectly placed to benefit and bid for its own licences.
Angus Geddes, of stock market newsletter Fat Profits, said: 'There will be blood on the market tomorrow. This is bad news for the two companies and Woolworths will probably be rubbing its hands together and opening the champagne.'
From 2012, owners of venues will own and run their own poker machines - and keep the revenue.
Craig Shepherd, an analyst at Commsec, said the announcement was a blow for both gaming companies.
'It was a shock decision and the value that the market thought was in the stocks from 2012 onwards has been wiped out. People thought they would retain the licences for poker machines but they haven't. Even though a change was always on the cards, nobody expected it to be this dramatic,' he said.
Tabcorp and Tattersalls had enjoyed a duopoly where the two companies were in charge of sourcing, buying and collecting the revenue from poker machines in Victoria.
From 2012, however, venues of any size will be able to bid for pokie machine licences for up to 10 years.
'Currently in Victoria, revenue from pokie machines is shared between Tattersalls or Tabcorp, the venue, and the government. But the changes move to a more NSW-style system where the venue owns and runs everything,' Mr Shepherd said.
He said Tatts and Tabcorp derived about 30 per cent of their earnings from the gaming machines, but still own significant assets such as their wagering licences.
Tabcorp chairman John Story said the company was disappointed by the decision and would review all available options to gain a refund on its $597 million licence fee.
The Victorian Government said yesterday neither Tatts nor Tabcorp were entitled to compensation as a result of the restructure.
'We are both surprised and deeply disappointed by the Government's statement that it disputes its obligation to refund the licence fee,' Mr Story said.
'Tabcorp's 216,000 shareholders, including 60,000 in Victoria, are relying on the Government to honour its commitment.'
Tabcorp said the gaming business was an important contributor to earnings, adding $118.7 million before interest and tax in the first half of 2008.
The Government said it would maintain total poker machine numbers at 27,500 and enforce a cap on ownership so that no one venue operator could own more than 35 per cent of machines available to hotels.
- news.com.au
Woolworth Poker
Originally published asWoolies to win on pokies