Ithuba Favored to Run South African Lottery

Fact checked by Lawrence Muller

othuba-lottery-copyTrade and Industry Minister Rob Davies announced that he has reached a decision regarding the new South African National Lottery operator, after a lengthy decision process. The Minister said that Ithuba Holdings has been chosen as the preferred candidate. He also said that Gidani Holdings, which presenly runs the lottery, will remain on as the reserve applicant if anything goes wrong during the license negotiation process.

The bidding process was finalized in November last year, with all applicants having to submit their offers by then.  The minister then consulted with the South African National Lotteries Board and asked that they evaluate the bids.  Two of them  – Mzansi Games and Grand Lottery – had their offers rejected by the Board.  The process was described by the minister as “rigorous”, and an announcement about the successful bidder was delayed by a month so that he could ensure that all the stipulated criteria had been adhered to.

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This week, Davies said that negotiations with the relatively anonymous Ithuba Holdings were under way and the two parties were now involved in negotiations around the license agreement. Part of the responsibility for running the national lottery involves paying hefty license fees to the Lottery Board. This should not be an issue for Ithuba, considering that it stands to make a lot of money from obtaining the license. To put things into context, the sale of lottery tickets in South Africa during the 2013 – 2014 financial year totaled over R4.5 billion.

“It is envisaged that the negotiations will be finalized during the course of November 2014,” said the minister in a statement. “The license agreement will provide for Ithuba to commence operating the lottery on 1 June 2015.”

The government has so far been unable to produce much information about Ithusa Holdings, leading to at least one political party expressing its wariness over the Lottery Board’s choice. The Democratic Alliance has already said that it would be conducting its own due diligence test of Ithuba to check that “it is above reproach, and that its directors have no connection to any political party or organization.”

“Given the scandals that have surrounded the lotto over the last decade, the new operators must be appointed transparently and with a comprehensive due diligence investigation,” said DA spokesman Geordin Hill-Lewis.Click here for Lotto Results | Click here for Powerball Results

Jeffrey Nel

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Fact-checked by: Lawrence Muller