Published: August 17, 2023

South African's lottery licence is up for grabs again -when current operator Ithuba's licence expires in May 2025.

At the end of August, a group of people probably numbering at least several dozen will gather in an as-yet undisclosed location for 14 hours worth of briefings about South Africa's national lottery.

By that time, most if not all of them will have paid R55 000 for access to a set of documents and a "virtual data room" that will tell them, in considerable detail, how money flows through the lottery system, from independent ticket vendors right through to payouts.

They will then have five months to turn that information into proposals on how, given the chance, they would run the lottery when current operator Ithuba's licence expires in May 2025.

In theory, those proposals must be submitted in early February in order for them to be properly evaluated and a winner announced in plenty of time for a smooth transition. But the odds of things going to schedule seem slim.

Ithuba won its licence in 2014, but was still fighting off a challenge from its predecessor Gidani into 2016. In 2007, the lottery was paused for half a year while Gidani's predecessor and SA's first operator, Uthingo, challenged being replaced.

With every change of operator, the way the lottery runs and the secondary games around it have changed.

Ithuba has indicated it hopes to be the first-ever operator to get a second term running the lottery, but Hosken Consolidated Investments (HCI) told shareholders it has already put together "an exciting bid"

The scale of the opportunity the lottery represents has traditionally attracted a large number of interested parties, at least in the early stages of bidding, before significant investment is required.

And that investment is significant. One insider has estimated that putting together a full bid can easily cost at least R15 million, and during the previous adjudication process bidders were required to put up a performance bond of R125 million.

The groups putting up that kind of money reconcile themselves with the possibility of further delays. 

Ithuba's licence had been due to run only until May 2023, but was extended because, said the department of trade, industry and competition (dtic), of the exceptional circumstances Covid-19 represented.

As of last week, the dtic is committed to a timeline that includes the end-August briefings, a deadline of 31 October to pay for access to the data around the lottery, and the early-February deadline to submit bids.

However, all those dates are subject to representations and legal challenges and, having extended the current licence once already, it could be hard to argue against further extensions. 

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