ndustry sources said An Post is set to follow Canadian investor Ontario Teachers’ Pension Plan (OTPP) into a process to sell 100pc of Premier Lotteries Ireland (PLI), the National Lottery operator which they own together with the An Post Pension Funds.
OTPP hired investment bank UBS last month to manage the disposal of its 78.6pc share of PLI, which it acquired for €405m with An Post in 2014 in a Troika-ordered privatisation deal.
The sale was for a 20-year licence to operate the National Lottery. Any buyer will have to continue to fund good causes in line with the terms of the existing licence.
Under a “drag and tag” arrangement agreed as part of that deal, An Post is required to sell its minority stake if OTPP sells, but the Canadian fund must include An Post in any sale it undertakes.
The terms effectively make An Post a forced seller while also ensuring it can influence the sales process despite being a junior partner.
An Post declined to comment when contacted.
Czech lottery operator Allwyn, Europe’s largest lottery group, is seen as a front-runner among a group of potential international bidders for OTPP’s stake in PLI, having closed two sales with the Canadians in recent months.
The Czech company won the contract to operate the UK national lottery licence starting next year and bought the current UK operator Camelot from OTPP last November. It bought Camelot Lottery Solutions, which runs online lottery systems and owns the Illinois state lottery, in a separate deal with OTPP in December.
Allwyn has already held talks with the UBS bankers running the Irish sale, as well as management at PLI, according to a report in the Financial Times.
That would put the National Lottery under foreign ownership for the first time since it was created in 1986.
OTPP and PLI declined comment. Allwyn did not respond to a request for comment.
If Allwyn secures OTPP’s majority stake, the combined 21.4pc shareholding split equally between An Post and the An Post Pension Funds must automatically be a part of the deal, it is understood.
That would put the National Lottery under foreign ownership for the first time since it was created in 1986.
An Post was its sole operator until 2014.
While the Irish lottery licence permits any of the shareholders, including An Post, to sell their interest in PLI, any deal will require the written consent of the Regulator of the National Lottery.
The regulator confirmed that the National Lottery would continue to be operated by PLI under the same licence until the end of 2034 irrespective of any sale.
A spokesperson for the regulator said it was not in a position to comment on speculation regarding a change of ownership of PLI.
The National Lottery made sales of €1.05bn in 2021, its most successful year to date. Of that, €304m was distributed to what it calls “good causes”, while €586m was paid out in prizes.
An Post’s shareholding was valued at €31.75m at the end of 2021 and is made up of a shareholder’s loan at 9pc, preference shares and a small equity portion.
The stake generated €6.4m in net cash in 2021.