Looking to crack the lottery business
south of the border, Scientific Games Corporation (SGMS) will soon acquire 65%
of a company that is the leading supplier of lottery tickets in Latin America.
According to a company announcement,
SGMS will pay a maximum of $8,255,000 for the majority ownership of Serigrafica
Chilena S.A. The agreement requires that the acquirer pay $3.9 million in cash
at the closing and up to $4,355,000 in cash or stock upon the achievement of
certain earnings targets over the next four years.
“Historically,” explained Lorne
Weil, chairman and CEO of Scientific Games, “there have been significant
duties on the ÂÃ‚Âimport of instant tickets and phone cards to Latin America
which, together with logistical issues, made doing business there prohibitive.
This acquisition opens the door to a significant new market for Scientific
Games. In ÂÃ‚ÂCentral and South America, approximately 1.1 billion instant tickets
and 360 million prepaid phone cards were sold last year and none of these
products incorporated the product ÂÃ‚Âdevelopment, advanced communications,
printing technology and security that ÂÃ‚ÂScientific Games uses to protest issuers
and their customers.”
the corporate front, SGMS said it has filed to offer 12.5 million common shares
through an underwriting syndicate led by Bear, Stearns & Co. Inc. Also, the
underwriters were granted the option to purchase from Scientific Games up to
1,875,000 shares to cover over-allotments.
The company didn’t say how they
expected to apply the proceeds to corporate needs.