An alternative gaming play
NIVEUS WAS spun out of HCI in September last year and holds gaming interests in 39.9% of KWV and 90% of Formex. Of interest are the two wholly-owned gaming companies Vukani Gaming Corporation and Galaxy Bingo, which operate l i mited pay- out machines (LPMs) and run bingo halls.
These two gaming assets are not in your traditional casino and as such get a lot more passing traffic. Further, LPMs are secured and managed by the establishment (pubs, clubs, etc) they are placed in, with Niveus only really responsible for keeping them operational and of course the initial purchase of the machines.
Local regulation allows for 50 000 LPM machines in South Africa and thus far only some 16% have been rolled out, leaving a lot more upside. The risk is a consumer who is under pressure but this may play into the hands of the LPMs as a casino is in many senses a ‘trap’, whereas LPM are more incidental and are likely to attract a growing share of the gaming market.