Camelot bids to run the Pennsylvania Lottery
January 8, 2013
UK Lottery promotion at St. George’s Hall in Liverpool
The
Camelot Group of Companies, the licensed operator of the UK National Lottery,
has submitted a bid to run the Pennsylvania Lottery, which the state is
attempting to outsource through a Private Management Agreement (PMA).
Camelot has submitted a
priced bid that includes 20 years’ worth of annual profit commitments. The bid
is valid until Dec. 31, 2012, and is supported by $50 million in bid security the state would retain if the bidder is
awarded the PMA but fails to execute the contract.
“The receipt of a priced
bid represents an important milestone in this process, which began last April,”
said Dan Meuser, revenue secretary for the state. “While there are several
additional steps before we’ll be prepared to make a final decision, this is a
proposal that warrants a complete and detailed review, and it is encouraging to
see the potential private manager propose 20 years of significant profit
growth.”
Now that a binding bid has
been received, the state will consider the bid against historic and projected
Pennsylvania Lottery performance data to ensure the bid provides incremental
profit growth above what the lottery could achieve on its own. Additionally,
risk mitigation firm Kroll Advisory Solutions will conduct a full investigation—delving
into criminal history, financial history, reputation, business practices and
contractor integrity—into Camelot and its executives. Kroll’s findings will be
used to evaluate the suitability of the bidder before a private management
agreement would be executed.
Pennsylvania is also
engaged in discussions with the union representing lottery employees consistent
with the union contract. The state will evaluate and consider any alternate
plan the union may propose prior to making a final decision.
The
state began exploring a PMA for the Pennsylvania Lottery last year as a way to
maximize lottery
profit and ensure secure, predictable funding for programs benefitting a
dramatically growing senior population. The lottery was created in 1971 to
generate funds for programs benefitting older adults. Since 1972, when its
first game went on sale, the Pennsylvania Lottery has contributed nearly $22.6
billion to programs for seniors. The Pennsylvania Lottery remains the only U.S.
Lottery that exclusively designates all proceeds to programs benefitting older
residents.
The Camelot Group of
Companies has more than 18 years of experience in running lotteries. In the
United Kingdom, Camelot is the licensed operator of the National Lottery and is
committed to raising money—£29 billion to date—for the Good Causes, the UK
beneficiaries of the lottery. In 2010, one of the world’s largest
single-profession pension plans, Ontario Teachers’ Pension Plan, acquired the
Camelot Group of Companies.
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