Gambling Authority, Grow Mine restart national lottery talks

Negotiations have resumed between the Gambling Authority and the national lottery’s preferred bidder Grow Mine, following the resolution of various legal battles and court actions. BusinessWeek has established that the South African lottery company Ithuba lost its case against the Gambling Authority, in which it demanded that the Authority halts negotiations with the preferred bidder, Grow Mine.

The Authority’s CEO, Thulisizwe Johnson confirmed the developments noting that they have progressed after the delays.

“Unfortunately, for governance reasons, we are unable to comment on the negotiations at the moment. “We will share the outcome of the negotiations and key issues at the right time,” he said.

Prior to the legal cases, the Authority had said the negotiation terms are based on the company’s contribution to the National Lottery Fund, which is designed to benefit the broader economy. The talks, due at the time to last three months, would discuss the terms of the contract.

Grow Mine, a consortium of powerful and wealthy shareholders, would run the Botswana National Lottery under a 10-year licence and be expected to pay an annual licence fee of P1 million. The consortium was expected to have to pay a P10 million advance to kickstart the lottery. However, the negotiations last year were paused after Ithuba accused the Gambling Authority of flouting its own regulations regarding the lottery. Ithuba said the Authority had not conducted investigations into the applicants’ background to ascertain their suitability. Further, the South African firm accused the Authority of failing to convene public hearings in respect of all applicants. However, in court papers, Johnson said certain sections cited by Ithuba as regulatory violations did not apply to the national lottery licence applications but rather to gambling establishments. He said the Authority was not obliged to follow a public notice and comment procedure or hold a public hearing in the terms.

According to Johnson, the Authority had conducted thorough investigations into the applicants’ background. He said according to the request for applications, all applications were required to submit fit and proper documentation including police clearances, tax clearances and World Lottery Association Certificates of Suitability. Initially, Gambling Authority received five bids from Grow Mine, Ad Infinitum Lottery, WinA-Lot, Khupele Khupele and Ithuba Botswana.

Several prominent businesspeople, including Sefalana Group managing director, Chandrakant Chauhan, his chief finance officer Mohammed Osman, a renowned banker Moatlhodi Lekaukau and other business heavyweights, Percy Raditladi, Carthage Matlhaga, Boatametse Kganela and Dale Terhaar are behind Grow Mine. A certain percentage of the lottery proceeds will be donated to the National Lottery Fund to benefit the creative industry, the youth and other sectors.