Big names backing Twin River
Twin River Worldwide Holdings has announced that Scientific Games Corporation is backing its efforts to obtain a contract to run the Rhode Island Lottery.
Camelot and Intralot have also partnered with Twin River in its attempt to secure the Rhode Island Lottery contract from International Game Technology (IGT). The lottery contract held by IGT does not expire until 2023.
Earlier in the year, Governor Gina Raimondo proposed extending the deal with IGT by an additional 20 years without holding a bidding process. This proposal created controversy, something that Twin River is strongly opposed to and why they are now fighting for the contract.
Bring on the competition
Twin River wants to the chance to compete and claims that with their partners, they can provide a better deal for taxpayers in the state than IGT.
If Twin River wins the contract, it plans to build a headquarters in Rhode Island, creating 1,100 jobs. This is the same number of jobs IGT has threatened to remove from the state if a bidding process for the contract takes place.
Marc Crisafulli of Twin River said:
We just want a chance to compete. Competition gets the best deal for the state. It gives the kind of transparency that you need.”
According to Crisafulli, he believes IGT is afraid of competition and will do anything to avoid a bidding process.
Rhode Island Lottery oversees virtually all gaming in the state. The current contract with IGT covers the lottery products and services, as well as slot machines at Twin River casinos. The contract allowed IGT to install 85% of the slot games at Twin River Casino and Tiverton Casino.
Twin River claims it would save $300m from the IGT deal if it secured the lottery contract. The company stated that the gaming machines provided by IGT are not bringing in revenues like those installed by other providers.
contract allowed IGT to install 85% of the slot games at Twin River Casino and Tiverton Casino
Reportedly, as much as $31,000 less is generated per machine each year when comparing IGT machines at Twin River properties in Rhode Island to those from other sources.
Twin River has been opposed to IGT maintaining the lottery contract since the proposal was made by the governor. According to VSO News, Twin River came out strong against the proposal, stating it would cost the state lost revenues from the gambling industry if approved.
In response to Governor Gina Raimondo’s exclusivity deal with IGT, Twin River placed a full-page ad in The Sunday Journal. The ad stated that without putting the contracts out to bid, the state is losing out on a potentially better deal. Twin River called the terms of the deal bad and that they undermine competition.
Questioning Twin River’s integrity
Governor Gina Raimondo did not hold back in her response to Twin River’s new partner and efforts to obtain the Rhode Island lottery contract.
She continues to back IGT and stated she has serious concerns about Twin River management and their ability to run the business, much less trying to operate a business that they are ‘clearly unqualified to do and have no track record of doing’.
The license held by Twin River requires a debt to revenue ratio of 4:1. The company pushed this amount to 4.5:1 during the spring months to reward their investors with share repurchases and dividends.
Twin River claims officials reassured them that the language of the license would change involving the debt to revenue ratio. The company claims the state reneged on this deal after Twin River publicly challenged the lottery contract extension for IGT.
Sports betting woes
On top of its efforts to obtain the lottery contract, Twin River is also dealing with sports betting issues. Over 12,000 people have signed up for online sports betting accounts in the state since the offering launched in August. While the online option has been live for a few weeks now, many of those who signed up have yet to take the final step to activate their accounts.
According to VSO News, the testing phase began in August. The state expected to see a much-needed boost in revenues once the mobile component launched. Without the activation of all signed up accounts, the estimated revenues from mobile sports betting will not be reached.