Sazka Bid To Takeover UK Lottery Citing Camelot Failings

The UK National Lottery first rose to prominence back in the second half of the 90s following its introduction in 1994. The licence for it was originally granted to Camelot at that time, and then again in both 2001 and 2007. Throughout its years of activity, the lottery has introduced multiple games to entice players, resulting in there being options such as the Thunderball, EuroMillions, Hotpicks and more available to access. Doubtless, the variety of games (including various purchasable scratch cards and online options) has led to the success of the country’s lottery.

As it stands, most people will likely associate Camelot with the National Lottery, as it has been the operator for such for many years. However, that could all change in the future, as another operator looks to muscle in on it. Sazka, a pan-European lottery operator that already serves countries like the Czech Republic, Greece, Cyprus, Austria and Italy, has made mention of the fact that it aims to tackle Camelot for the UK lottery, too.

Camelot has pretty much remained unchallenged over its lottery operations over the years. What could it mean if Sazka takes over in the end? And furthermore, who exactly is Sazka? What does the company’s bid entail to take over the UK lottery and all associated games? We will be looking into all of these questions right here, and also what that would mean for Camelot if the takeover is successful.

Who or What Is Sazka?

Sazka Group is a company that primarily focuses its efforts on national lottery games, as well as instant lotteries and online lotteries. Its secondary focus rests in the area of digital gaming and sports betting. As things stand at the moment, Sazka is owned by the international investment group, KKCG.

It is one of the lottery leaders in Europe, with around 63,000 points of sale and digital platforms being available. This allows it to serve a market of more than 79 millions adults, resulting in annual sales of around €17 billion (£14.5 billion).

As things stand at the moment, Sazka contributes to five of Europe’s economies with its lotteries. When it comes to all of these, it exists as the number one lottery operator, and in the Czech Republic, it has held a lottery licence since 1956. In Austria, it holds the exclusive lottery licence and even operates casinos within the country’s borders. Meanwhile, around 34,000 points of sale can be found within Italy, while in Greece and Cyprus, Sazka has exclusive lottery, land-based sports betting and video lottery terminal licences.

It is this sort of success that has led Sazka to become highly regarded within Europe. Additionally, the operator keeps the highest standards of player protection in mind when it comes to its operations. All products from the company have been awarded the best level of responsible gaming certification by the World Lottery Association and the European Lottery Association. One more thing of note about Sazka, is that 100% of its revenue is regulated and all activities are supervised by a selection of regulators within the world lottery market. This includes Australia, Switzerland, and the four European markets mentioned earlier.

Why Does Sazka Want to Takeover the UK Lottery?

It was in October of 2020 that Sazka first made an announcement that it had plans to takeover the UK lottery. It said that it had entered into the running for the Gambling Commission’s competition to select the operator of the fourth licence to run the country’s lottery by completing its own response to the Selection Questionnaire. At the time, the CEO of Sazka, Robert Chvatal spoke of the fact that his company had made no secret of the fact that it would love to operate the UK National Lottery.

“The UK National Lottery is a national treasure with a proud 26-year history. Now it is looking forward to the next decade and how it can best serve its customers in a world so disrupted by digital transformation, the fourth industrial revolution and Covid. The landscape from when the UK National Lottery was launched back in 1994 has changed beyond measure”, Chvatal said.

Of course, it will not be able to simply waltz straight in with its takeover bid. Sazka faces competition from the incumbent Camelot, as well as the Indian lottery operator and technology provider Sugal & Damani. Both of those operators have also put forward their own bids for the National Lottery of the UK. However, in an effort to support its own bid for the lottery, Sazka has picked up various new staff members for its team, with four of them specifically focused on the UK market.

Emma Young was brought on board as the transition lead, focusing on leading the transition and exit plan as part of the tender process. She reports directly to the operations and technology stream leader, Tony Khatskevich. Gerry Walsh was also introduced to the Sazka team, operating as supply chain manager in London. It is his responsibility to design and develop the operator’s future supply chain and procurement strategy. Other new team members include Rob Clarke as organisation leader for the takeover bid, and Steve James to provide his services in the network area lead.

Once January rolled around, Sazka announced that it had enlisted the services of former Sainsbury’s Plc CEO, Justin King (CBE). He was introduced to sit on the ‘advisory board’, so that he could provide counsel to Sir Keith Mills and his bid team. King is now playing a pivotal role in developing the Sazka business strategy on how a revamped National Lottery can recover from the impact of the coronavirus pandemic.

It did not take long for King to fully back the Sazka takeover, claiming in February that it will revive Britain’s ailing high streets significantly. Speaking with The Mail on Sunday, King stated that Sazka has the intention of adding its “technological savvy” to the lottery’s online offer, as well as drive more players to play the lottery via independent stores. He also claimed that the lottery at current is being driven by fewer players playing much more often, which he outrightly stated is not a good trend.

“The lottery was billed as one of the saving graces of the independent corner shop – it would be a footfall driver, a reason for regular visits, which perhaps those corner shops have lost”,

King stated in the interview.

Arguments Over Camelot’s Failings

While it is not surprising that other companies would be looking to take over running a National Lottery as prolific as the one in the UK, usually this would just result in bids being put in for it. However, Sazka has gone a step further and pointed out the various shortcomings of current operator, Camelot. As things stand at the moment, Camelot still allows 16 and 17-year-olds to buy tickets for the lottery as part of current legislation.

Of course, as you may know by now, the legislation is due to change in the coming months, stopping everyone under the age of 18 from buying lottery tickets online or in land-based retail stores. Sazka outrightly supported the decision to change the legal age for buying lottery tickets, which was not something that Camelot specifically voiced its support for upon its announcement.

In fact, Camelot CEO Nigel Railton gave his own statement once it was announced that the age would be reduced, stating that it would take a year to implement such alterations.

“We just can’t do things overnight. It’s not a small task, it’s going to cost about £6 million to do it”, he said. “And it’s not the money, it’s just we’re in the middle of this Covid crisis. We’ve got a lot of priorities, this is one of them, and the sooner we get clarity, the sooner we’ll get on with it”.

The fact that 16 has been the minimum age for players to buy lottery tickets in the UK since its inception remains something that Sazka states is out-dated. It said that local laws meant the Sazka Group limits the sale of its lottery products to those who are 18 years of age and older in four of the existing European lottery markets, and for online sales in the fifth of them. Sazka went on to say that it is, of course, a decision that the Gambling Commission has to implement, but that it highly supports the move to increase the legal lottery ticket age in the UK.

Charles Garland Joins the Sazka Effort

At the beginning of February this year, it was announced that Charles Garland had joined in the effort of Sazka to takeover the UK lottery. As the former CEO of Syco Entertainment (the joint venture between Simon Cowell and Sony Music), Garland was added to the European lottery operator’s advisory board alongside Lastminute.com founder Brent Hoberman and the aforementioned King, to provide advice to Mills with creating strategies for widening the lottery’s appeal.

Sazka has stated that the lottery has lost 8.5 million players in recent times for one reason or another. Garland was responsible for the global rollout of the X-Factor television programme, and he worked closely with David and Victoria Beckham when they were creating their own brands. It is due to this that Sazka was more than happy to have him included in its advisory team.

Speaking on his appointment to the team, Garland said:

“The National Lottery was once a staple of British entertainment, but in the era of Netflix, podcasts and video games, it needs to adapt to changes in customer behaviour. But in order for this to happen, the National Lottery must have a digital-first operator with a track record of turning underperforming lotteries into cherished household brands. This is exactly what Sazka Group do – together we are working on proposals that will make the British public fall back in love with this vital institution”.

The winning applicant for the National Lottery 2023 licence will be announced in September of this year. Camelot will likely remain a strong contender for that licence, although Sazka is putting itself forward as a massive competitor too, thanks to its various exceptional achievements across Europe.

It is thought that bidders are looking into technology that will use localised marketing as a way of informing players about nearby lottery ticket sellers.

Sazka Holds Itself in High Esteem

Not only does Sazka have the best praise for itself and its accomplishments so far, but it is ultimately happy with the team that it has put together so far. Remarking on Justin King’s expert knowledge of UK retail and the complex supply chains, the operator was quick to state that he led the turnaround of Sainsbury’s performance. This led to him delivering 36 consecutive quarters of sales growth and profit.

At the same time, King was praised by Sazka for his revitalisation of the supermarket’s social responsibility commitments by spearheading a partnership between it and Comic Relief. This saw £1 of every £10 spent in store donated to the charity, and it was due to these efforts that he was awarded a CBE in 2011.

The likelihood is also that Sazka has not finished bringing experts on board. With Mills leading the way, and now Hoberman, King and Garland adding their expert knowledge to the efforts, there is little doubt that the operator poses a large threat to Camelot being able to obtain the licence again.

However, there could be a bit of a dark horse working in the favour of Camelot in the form of newsagents in the UK. Many stores have hit back at the plan for tickets to only be sold online. While Sazka is definitely looking to reinvigorate the lottery in the UK, the National Federation of Retail Newsagents president Stuart Reddish stated that the lottery has been about supporting local communities since its inception in ’94. He said that taking the lottery online completely makes no sense, especially at the time when people are rediscovering the benefits of shopping at their local convenience stores. Camelot could potentially use that as a way of keeping itself firmly in the running for the fourth licence.