National lottery operator Camelot is on track to keep its lucrative license after winning preliminary approval from the gambling regulator, The Telegraph can reveal.
In a move likely to spark a final round of intensive campaigning by rivals, it is understood the Gambling Commission is set to recommend that Camelot be given ‘preferred bidder’ status.
It comes after the operator, owned by the Ontario Teachers’ Pension Plan Canada fund, achieved the highest score on a scorecard designed to judge the merits of offers. This paves the way for Camelot to hold the national lottery license it first won in 1994 until at least 2034.
The Gambling Commission has forwarded its scorecard to Nadine Dorries, the Culture Secretary. A formal announcement is expected later this month following a final ruling by the Gambling Commission, but sources have warned the timeline could change.
Officials are on high alert for this very sensitive process. All parties expect the final decision to be made to face a challenge in the High Court from the losing bidders.
The news from the Gambling Commission’s scoreboard is set to trigger the latest efforts by Allwyn Entertainment, a gambling operator controlled by Czech energy billionaire Karel Komarek, to snatch the National Lottery from Camelot. She retained the services of legal advisers from the municipal firms Freshfields and Bird & Bird.
The Gambling Commission’s scorecard approach aims in part to demonstrate the objectivity of the process under potential legal scrutiny.
All the bidders have spent millions of pounds preparing their bids and campaigning. Allwyn has spent a lot on advertising, for example.
Two other bids, one from Italian lottery operator Sisal and the other from media mogul Richard Desmond are also on the way to disappointment. Sisal’s failure comes despite an eleventh-hour appeal from its future new owner Flutter Entertainment, the FTSE 100 bookmaker behind Betfair, to the Gambling Commission.
The fourth competition for the National Lottery license, delayed for a year because of the coronavirus, has been shrouded in secrecy. Interested parties were banned from lobbying or speaking publicly about their bid or that of their rivals.
Camelot’s expected victory is its first under foreign ownership. The operator was acquired by the Ontario Teachers Pension Plan for £400million in 2010. It was previously owned by a British-led consortium that included Cadbury Schweppes and ticket maker De La Rue.
The prospect of a legal challenge means there could yet be another twist in the race to run the National Lottery until 2034.
In 2000, Sir Richard Branson appeared to be in pole position to take control of the National Lottery after authorities opened exclusive talks with the Virgin Group founder. But Camelot emerged victorious after ministers asked for the offers to be reconsidered.
The National Lottery ranks among the most lucrative public sector contracts in the UK. The fourth license, which will begin in 2024, is expected to generate over £80bn in ticket sales. With the operator taking an average of 0.5p per pound, this means overall profits of around £400m.
The Gambling Commission declined to comment on Wednesday,
On Thursday, after this article was published, a spokesperson said: “Our job is to run the best possible competition – fair and open competition, which results in the best outcome for the players and the good causes.
The competition process is not yet complete. The Board of Commissioners of the Gambling Commission makes the final decision and will advise the government when that decision is made.”