Minister for Racing Kieran McAnulty has announced the approval of a 25-year partnership between TAB NZ and UK betting company Entain that delivers at least $900 million in guaranteed funding for the racing industry over the next five years.
Entain, a UK based group that operates multiple sports betting providers globally, will use their economies of scale and significant technology and capital capabilities to deliver TAB NZ’s betting, wagering and broadcast operations.
“This is one of the most significant days in New Zealand racing history. This deal will reverse falling revenues for racing and provides certainty over the coming years,” Kieran McAnulty said.
“I’m confident this agreement will help secure a solid future for the racing industry and sports in New Zealand through increased financial distributions to national sports organisations.
“TAB NZ has been facing increasing financial challenges over recent years and was facing an uncertain future, largely due to competition from offshore gambling websites.
“The Agreement provides an upfront payment of $150 million upon approval of the agreement. In addition to this there will be a 50% revenue share from day-1 with guaranteed payments of at least $150 million per year for the first five years.
“This partnership will also allow TAB NZ to use Entain's expertise and economies of scale to make necessary upgrades and invest extensively in infrastructure and technology. It will be an improved offering for customers.
“Our racing industry is worth $1.6 billion to the economy and directly employs 14,000 New Zealanders. It’s reliant on TAB NZ distributions, and if they were allowed to fall that would hit the industry hard and jobs and revenue lost.
“It’s important this deal assists in reducing gambling harm. As such I’ve received confirmation from TAB NZ of a $5 million allocation for harm minimisation measures upon approval of the agreement.
“Entain has better harm minimisation technologies, such as facial recognition tools that can be rolled out in TAB venues.
“The partnership between TAB NZ and Entain does not prevent the Government from putting in place further harm minimisation regulation, and I have been clear with TAB NZ that I intend to do so.
“I am also pleased to announce that Cabinet has decided an in-principle agreement to extend TAB NZ’s monopoly for sports and racing betting to the online environment, subject to further work being done.
“The TAB was set up as a monopoly to fund New Zealand racing and sports. But the onset of unregulated online gambling changed the game and our racing and sports industry has been losing money ever since.
“Regulating this environment offers a significant new revenue source for local racing and sport, while also addressing the inherent risks in unregulated online gambling.
“By prohibiting online gambling outside of the TAB the Government can place greater controls over the betting environment. We would expect to also see much more money allocated to harm minimisation, a fairer deal for Kiwi punters and sports codes and a greater focus on animal welfare,” McAnulty said.