South Africa Lotto to continue amid last-minute deal to cover transition to new operator
A deal has been reached to allow Ithuba to continue to operator South African’s Lotto and sports pools as tender winnder Sizekhaya prepares to take over.
South Africa.- A last-minute deal has avoided the suspension of Lotto in South Africa. The continuation of operations had been in doubt after Sizekhaya Holdings was named the winner of a new eight-year licence to run South Africa’s National Lottery and Sports Pools.
Sizekhaya was chosen from eight applicants in a competitive tender process overseen by Parks Tau, the minister for trade, industry and competition, to take over from Ithuba Holdings in a tender reported to be worth about R200bn (€9.8bn) over eight years. It will be the fourth National Lottery and Sports Pool licence holder and will be responsible for managing all aspects of operations, including ticket pricing, revenue generation and the allocation of funds to social initiatives.
However, the immediate continuation of operations was in doubt because Ithuba Holding’s licence expired yesterday (May 31) leaving no time for a transition period. The National Lottery Commission (NLC) had intended to grant Ithuba’s sister company, Ithuba Lottery, a temporary 12-month licence, but the Pretoria High Court has rejected that move, ruling that a temporary licence holder could only be assigned for five months.
Ithuba rejected the option of a five-month temporary contract as unprofitable, leading to a situation in which lottery operations would have had to stop today. However, it’s being reported that Parks Tau has intervened in a last-minute meeting with the National Lottery Commission (NLC) and Ithuba, apparently going above the High Court’s decision to grant a 12-month temporary licence to Ithuba until the end of May 2026, when Sizekhaya will takes over as operator.
Ithuba received an eight-year licence in 2015. This was extended by two years in 2023, resuting in an unprecedented 10-year tenure. The impact of the Covid-19 pandemic was given as the motive, but reports this year that the tender process had been further delayed caused controvery amid allegations of government connections to the operator. The NLC said it had R2.2bn in reserves to continue paying grant beneficiaries if Lotto operations were suspended.
South Africa Lotto IP
Meanwhile, Sizekhaya chairman Moses Tembe has confirmed that as part of its bid the operator committed to handing over its intellectual property at the end of the licence period to allow the government to run the lottery in house.
“We have promised to hand over the intellectual property of our lottery design, development and execution to the government for insource capacity to run the Lotto at the end of our tenure. This and many reasons are why we believe we won the right to operate the Lotto for the next eight years,” he said.
