Australia’s leading gambling operator Tabcorp has signed a long-term extension of its reseller agreement with Jumbo Interactive.
The 10-year agreement will cover the reselling of lottery products in South Australia, Victoria, New South Wales, Northern Territory, Australian Capital Territory, Tasmania and also international jurisdictions.
As agreed before the extension was announced in June, Jumbo will pay $15 million to Tabcorp as part of the renewal. A 4.65% service fee of subscription revenue will also be imposed. This price will be phased in, beginning at 1.50% inFY21, and then 2.50% in FY22, and finally 4.65% from FY24. Furthermore, for the 2021, 2022, and 2023 financial years, Jumbo will pay a service fee of 4.65% on the value in excess of $400 million, when the value of subscriptions is more than $400 million for each applicable year
Mike Veverka, Jumbo chief executive and founder, said that the arrangement will help it reach its target of achieving AUS $1 billion (US$718.0 million) in ticket sales through its platform by 2022.
This means they will be combining and growing sales on the OzLotteries.com platform with sales in partner lotteries using the “Powered by Jumbo” software platform.
“The agreements to 2030 provide Jumbo with the ability to continue growing lottery sales in Australia over the long term,” Veverka said. “This long-term focus is necessary to also grow the new “Powered by Jumbo” SaaS business and achieve our ‘$1 billion vision’ by 2022,” he added.
The extended deal, however, does not include the reselling of Tabcorp products in Western Australia, where the operator currently doesn’t have a license.