Sportech signs major US horseracing deal with Penn National
Six-year contract will see UK-listed Sportech provide US operator will pari-mutuel wagering technology across nine states
Sportech has signed a six-year multi-state deal to provide US operator Penn National Gaming with pari-mutuel wagering technology at its 11 racetrack properties.
The exclusive agreement will see Sportech’s American subsidiary, Sportech Racing, supply betting technology and associated services across nine states, including five off-track wagering venues, plus internet and telephone account wagering services.
The contract, which includes an option to extend the agreement by up to two years, substantially broadens Sportech’s reach in the US where it currently processes around half of all horseracing bets.
In April the UK-listed firm extended a similar deal with New Jersey’s Monmouth Park Racetrack, while it is also the exclusive operator of online betting on all horseracing in Connecticut.
Sportech Racing was formed following the acquisition and rebranding of Scientific Games Racing in 2010. Sportech now employs around 700 staff in the US through its offices and operation centres in Connecticut, Atlanta, New Jersey and California.
Panmure Gordon analyst Simon French said in a note that the agreement underpins medium-term expectations for Sportech’s share price, reiterating a ‘Buy’ recommendation and 145p target price. With shares in the operator currently worth 89p, that implies more than a 60% uplift.
Sportech CEO Ian Penrose said of the deal: “ This further strengthens our position in the United States, and builds upon the international momentum following sales to the UK Tote and a contract with Danske Spil, the State owned Danish gaming operator, earlier this year.”
Christopher McErlean, vice-president of racing at Penn National Gaming, added: “We sought to enter into a partnership with a company that would bring significant advantages to Penn National Gaming in the form of improvements to the customer betting experience, increased compatibility between our properties, and delivery of improved operational efficiencies. After a thorough competitive bidding process, we determined that Sportech Racing was that partner.”