Loterj has always sought to increase its social actions by exploring traditional lottery modalities in Rio de Janeiro and at the beginning of this year it started a process to expand the products offer. The moment is coming, as the bidding takes place today (Monday, 5th) and should define a company to explore the online lottery, new physical modalities and sports betting.
The company's president, Oswaldo Luiz Pacheco Ribeiro, commented on Friday afternoon to GMB that everything is ready for the event. “The market value of this tender is for gross sales of R$3 to R$3.3 billion (US$ 593m to US$ 652m) in five years. We are optimistic and even believe that this number can be surpassed, given the interest of several companies in our tender,” he said.
According to him, in this first stage of the bidding, Loterj will receive the envelopes with the technical and financial documentation and with the commercial proposal for the exploration of new lottery modalities and exploration of online games.
According to the president, several companies were interested in the event, asked the necessary questions to understand the process and legal requirements and it is expected that at least four companies will attend to present all the documentation and the proposal to explore the activities in the scope of the state of Rio de Janeiro.
“So far [3pm on Friday, 07/02] four companies have made a technical visit to Loterj to know our facilities and analyze where an outpost of the winner of the competition can be installed, since the service provider will have a unit at Loterj's headquarters, where the new business will be monitored online and in real-time,” said Pacheco Ribeiro.
This was one of the requirements of the Notice and the four companies that carried out the visit showed no objection to being hosted at Loterj. "In this unit, we will have a direct view of the sale of all games, generating commercial intelligence so that we can measure what is happening and anticipate future events," commented the president.
According to him, the four companies have great expertise in the market and, so far, have followed all the procedures required by the Notice. “All are important companies and able to operate a new business in partnership with Loterj. We have a serious Public Notice and whoever wins will do a great deal for both parties,” declares Ribeiro, who did not say which companies complied with the technical visit, mandatory according to the tender. “For reasons of compliance and total transparency, we cannot say which companies visited Loterj,” he explains.
As is a requirement of the Notice, the president of Loterj said that it will be up to the Bidding Committee to define whether companies that did not make the visit will be able to participate in the event or whether they will be disqualified. “This is a sovereign decision of the Bidding Committee and not a measure taken by the president,” says Ribeiro.
Anyway, according to him, all companies that present themselves will be evaluated regarding the technical and financial part. “At this first moment, the technical and financial qualification envelopes will be opened, when the companies that will proceed to the second stage, which involves the commercial proposal, will be defined. After opening the technical-financial qualification envelopes, Loterj's Bidding Committee will suspend the session so that all submitted documentation can be analyzed.”
“This could take between ten and fifteen days, since this is a tender for millions of reais and the technical analysis needs to be done in detail. After that, the session will be reopened for the analysis of the commercial proposal and, then yes, the winning company will be defined,” he explains.
The market value of this tender is, for a period of five years, from a gross revenue of of R$3 to R$3.3 billion (US$ 593m to US$ 652m). According to the president, it is a feasible amount. “We carried out a market study to reach this value and it may even be higher, given the market's interest in our tender,” he said.
The selected company will have to add 3,000 points of sale for the new modalities to be created to the 4,000 already existing points. “It is perfectly possible to increase this new sales base, since there are countless ways for these points to be created,” he commented, noting that in previous tenders, minimum sales point requirements were also adopted.
When asked if the Notice was too strict, Ribeiro denied it. “We put in it the minimum necessary for a good result of the bidding and the new reality of what we intend to offer to the market in Rio de Janeiro. The requirements followed the same parameters as in previous bids. In this one, we only focus on one more theme, which is the fight against money laundering, requiring bidders to adopt international standards against it.”
The president did not expect new attempts to challenge the bid when he spoke with GMB, but stated that the company is prepared for this. "All questions so far have been well answered and for now I believe in an excellent result of the bidding." The only last-minute mishap was the representation of IGT and Scientific Games to the State Audit Court.
Through the Public Notice, new lottery modalities may be created, in addition to the implementation of online games, hitherto non-existent in Loterj, as well as sports betting which, in Ribeiro's assessment, “is the icing on the cake.”
The operation of sports betting, as well as the entire online operation, will have to be done only within the state of Rio de Janeiro. “The service provider must demonstrate the technical ability to track IP addresses to identify possible bets coming from other states,” it said.
Among the clauses of the Notice is the demand for a unit in Brazil by the company that won the bid. “With that, companies from abroad will have to establish themselves in the country or associate themselves with a local operator. This gives more security to the business and a better relationship between Loterj and the new service provider,” it explains.
Ribeiro is excited about the tender and intends for it to take place this today (Monday, 5th). He says that “this process is post-pandemic. We suffered a lot and now it will be redemption and turning point for the Lotterj in terms of serving the philanthropy for which we were constituted. Our revenue was below than what we expected, and this turnaround will be important because we will move to a higher level and, most importantly, very quickly, meeting the expectations of society in our state,” he concludes.
Source: Exclusive GMB
