Revenues from new venture projected at $550 million over seven years

Lottomatica S.p.A.’s wholly-owned subsidiary, GTECH Corporation, has announced that it has been chosen as the preferred bidder to negotiate a seven-year integrated services contract with the New York Lottery to provide new online lottery solutions and services. The Lottery has the option to extend the contract for an additional three years. GTECH’s proposed solution set includes a full suite of online and instant systems, up to 20 000 online lottery terminals, a variety of self-service lottery products and multimedia technology, a new wireless telecommunications network, instant-ticket warehousing, and ongoing services.

Online activities in state lotteries are exempted from US legislative bans on Internet gambling financial transactions.

The proposed contract, which is expected to commence in March 2010, follows a competitive procurement process. The New York Lottery estimates the total value of the contract to be more than $550 million over the contract period. Subject to a protest period which ends on April 3, 2009, the finalisation of the contract is slated for approval by the Attorney General and the State Comptroller by June 10, 2009, but may go beyond that date.

GTECH has been a lottery technology and services provider to the New York Lottery since 1986.

“We are honored to have the largest lottery in North America and one of the most respected in the world, the New York Lottery, remain as our valued customer,” said Jaymin B. Patel, GTECH President and CEO. “Lotteries from around the world look to the New York Lottery as a model for balanced and sustainable growth among their online, monitor, and instant game portfolios. As the Lottery’s online vendor, GTECH will continue delivering the maximum player experience, integrity, security, and profitability, in order to ensure the New York Lottery continues to be the standard bearer for the global lottery industry.”

Gordon Medenica, Director of the New York Lottery said: “We are pleased to continue our successful partnership with GTECH and look forward to a new generation of state-of-the-art equipment. The New York Lottery makes extreme demands on its full service system, with huge transaction volume, complexity of operations, diverse geography, extensive marketing and constantly-evolving game choices. Reliability, integrity, and experience are critical to a successful relationship, and GTECH has consistently delivered on all these points."

Over the duration of the new contract, GTECH will continue providing the operation and maintenance of the central system; terminal maintenance; warehousing and distribution of instant tickets; field service; marketing consultancy; and hotline management.

The New York Lottery recorded more than $7.5 billion in total sales in its fiscal year 2008, an impressive $2.6 billion of which was allocated to educational programs in New York.

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