Scientific Games Announces Strategic Partnership with Playtech

New JV and Partnerships to Offer Internet, Gaming Terminals and Monitoring Systems to Regulated Gaming Operators

Jan 21, 2010, 07:00 ET from Scientific Games Corporation

NEW YORK, Jan. 21 /PRNewswire-FirstCall/ -- Scientific Games Corporation (Nasdaq: SGMS) and Playtech Limited (AIM: PTEC) today announced the formation of a number of important strategic partnerships to jointly develop and market next-generation internet and land-based gaming products and services to regulated gaming operators.  

These partnerships combine Playtech's industry-leading B2B gaming software and comprehensive portfolio of products with Scientific Games' proven ability to provide added value, turnkey solutions to government-sponsored (B2G) and commercial (B2B) gaming operators.  They comprise:

a.) a new joint venture, to be called Sciplay, focused on B2G internet government-sponsored and government-regulated lottery and gaming; and

b.) a systems partnership in gaming terminals and development utilizing Playtech's Videobet software platform, technology expertise and gaming product suite.

Mike Chambrello, CEO of Scientific Games and Mor Weizer, CEO of Playtech together commented:

"This is an important step for both companies. We have highly complementary skill-sets allied with a global reach and this partnership provides the opportunity to leverage off this combined know-how to maximum effect.  This is an ideal partnership in many ways.  Customers will benefit from best of breed content, sophisticated player management systems, and long-standing industry experience in providing highly secure, regulated, compliance-oriented services.

The related gaming terminal partnership brings the potential for operators to enjoy a technology platform that is seamless, integrated and adaptable both to multiple delivery channels and cross-promotional opportunities."

Further details on the partnerships are set out below:

Sciplay Joint Venture

Scientific Games and Playtech have entered into a 50:50 joint venture to deliver the latest state-of-the-art internet technology to government-sponsored and government-regulated lottery operators under the brand name, Sciplay.  The joint venture will marry Playtech's acclaimed B2B internet gaming software and content with Scientific Games' nearly 40 years of B2G expertise in creating revenue-generating, responsible gaming, fully compliant solutions for government gaming entities.  The combination will enable Sciplay to offer customers a comprehensive range of gaming content and gaming solutions, consistent with the various regulatory regimes that may apply.  Sciplay will have global exclusive rights to Playtech's internet technology for these customers.  The alliance will deliver to customers:

  • A complete suite of internet games including instant games, casino, poker, sports and skill games on a single platform with a leading player management system;
  • Proven marketing, advertising, promotional, operational and customer support services;
  • A range of support services including hosting, payment processing, content management, customer relationship marketing and affiliate management; and
  • Comprehensive compliance and responsible gaming safeguards.

Playtech and Scientific Games have agreed to appoint Richard M. Weil as Managing Director of Sciplay.  Rick formerly served as President of Fun Technologies (a leader in the internet games business), prior to which he served as VP of International Sales for SG.  

Gaming Terminals and Systems Partnership

Scientific Games and Playtech have also agreed to a strategic partnership relating to both fixed odds betting (FOBT) and video lottery (VLT) gaming terminals and systems development.  

Scientific Games is a world leader in gaming terminals and systems for wide area, government-regulated and government-sponsored gaming environments.  The Company, through its wholly owned subsidiaries The Global Draw and Games Media, currently owns and operates approximately 18,000 server-based gaming machines throughout the world.  Moreover, Scientific Games has deep expertise in developing gaming terminals and systems for ensuring compliance with government requirements.  

Through its Videobet subsidiary, Playtech has successfully pioneered the adoption of internet-style technology to land-based venues and provides operators with access to Playtech's leading products and content.  The technology also provides operators with a highly cost effective way of delivering gaming content to land-based venues, while providing deep venue management capabilities.  This strategic partnership provides Scientific Games with exclusive access to the Videobet technology for its gaming terminal business in North America, United Kingdom and other key jurisdictions, and non-exclusive access in the rest of the world.  

As part of the new partnership, Playtech will also lead the development of Scientific Games' next generation systems technology, delivering a strong competitive advantage.  These will offer comprehensive gaming systems that provide governments and commercial operators significantly greater functionality at lower cost, while meeting emerging industry standards and protocols.  Functionality that was once confined to standalone systems will be merged into a single platform, both enhancing functionality and reducing cost for the operator.  

Gaming operators and their players will enjoy a new level of flexibility and convenience by providing them with a technology platform that is seamless, integrated and adaptable to multiple delivery channels.  Where permitted by law, operators will have the ability to integrate their instant ticket, traditional lottery, internet, and brick-and-mortar systems, which allows for better player tracking and cross-promotional opportunities across all platforms.  

The strategic partnerships should generate significant long term shareholder value and enhanced growth prospects for Scientific Games and Playtech.  This partnership is expected to be relatively neutral to Scientific Games' 2010 earnings and slightly accretive to Playtech's 2010 earnings.  Both companies are expecting the partnerships to be accretive thereafter.  

Mike Chambrello, President and CEO of Scientific Games commented:

"This is a significant advancement in our long-term strategic plan to deepen our participation in wide-area, government-sponsored and government-regulated gaming. We anticipate that internet (and associated multimedia distribution) will be the next large wave of growth in gaming. Government entities will play major roles, whether as sponsors or regulators, and are expected to look to suppliers that have deep experience in providing highly secure, regulated, compliance-compatible services.

We believe Playtech's extraordinary capabilities and experience catapult us to content- and technology-driven leadership in delivering next-generation products in a comprehensive manner.  We believe that these partnerships with Playtech will be exciting for consumers, revenue driving for customers and profitable for our shareholders."  

Corresponding with this announcement, Scientific Games will be hosting an analyst day on Thursday, January 21, 2010, beginning at 8:30AM EST.  The presentations will be webcast on the investor relations section of Scientific Games' website, www.scientificgames.com.

About Playtech

Playtech develops unified software platforms for the online and land based gambling industry, primarily targeting existing online operators wanting to upgrade their system; sportsbooks looking to diversify and land-based operators making their online debut. Playtech gaming applications - online casino, poker, bingo, mobile gaming, live gaming, land-based kiosk networks and fixed-odds games - are fully inter-compatible and can be freely incorporated as stand-alone applications, accessed and funded by players through the same user account and managed by the operator by means of a single powerful management interface.

Founded in 1999, Playtech has more than 800 personnel distributed globally, around seventy five percent of whom are engaged in research and development of current and future gaming technologies.  It is an associate member of the World Lotteries Association.  Playtech has been listed on London Stock Exchange's AIM market since 2006 under the symbol (AIM: PTEC).

www.playtech.com

Playtech Contact

Ross Hawley

Head of Investor Relations

+44 (0) 20 7861 3232

About Scientific Games

Scientific Games Corporation is a leading integrated supplier of instant tickets, systems and services to lotteries worldwide, a leading supplier of server based gaming machines and systems, Amusement and Skill with Prize betting terminals, interactive sports betting terminals and systems, and wagering systems and services to pari-mutuel operators. It is also a licensed pari-mutuel gaming operator in Connecticut, Maine and the Netherlands.  The Company's customers are in the United States and more than 50 other countries. For more information about the Company, please visit our web site at www.scientificgames.com.

Scientific Games Contact

Investor Relations

212-754-2233

Forward-Looking Statements

Certain statements in this press release constitute "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995.  Forward-looking statements describe future expectations, plans, results or strategies and can often be identified by the use of terminology such as "may," "will," "estimate," "intend," "continue," "believe," "expect," "anticipate," "could," "potential," "opportunity," or similar terminology. These statements are based upon management's current expectations, assumptions and estimates and are not guarantees of future results or performance. Actual results may differ materially from those projected in these statements due to a variety of risks and uncertainties and other factors, including, among other things: competition; material adverse changes in economic and industry conditions; recent changes to certain contracts; technological change; retention and renewal of existing contracts and entry into new contracts; availability and adequacy of cash flow to satisfy obligations and indebtedness or future needs; protection of intellectual property; security and integrity of software and systems; laws and government regulation, including those relating to gaming licenses, permits and operations; inability to identify, complete and integrate future acquisitions; seasonality; ability to enhance and develop successful gaming concepts; influence of certain stockholders; dependence on suppliers and manufacturers; liability for product defects; factors associated with foreign operations; dependence on key personnel; failure to perform on contracts; resolution of pending or future litigation; labor matters; and stock price volatility.  Additional information regarding risks and uncertainties and other factors that could cause actual results to differ materially from those contemplated in forward-looking statements is set forth from time to time in our filings with the SEC, including under the heading "Risk Factors" in our most recent Quarterly Report on Form 10-Q.  Forward- looking statements speak only as of the date they are made, and, except for our ongoing obligations under the U.S. federal securities laws, we undertake no obligation to publicly update any forward-looking statements whether as a result of new information, future events or otherwise.

SOURCE Scientific Games Corporation



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