Greek betting monopoly OPAP said on Tuesday its renewed IT services contract with local gaming software firm Intralot will cost it significantly less than a previous deal.
OPAP, one of the flagship assets Greece is selling to fill its depleted coffers, announced earlier this month it was renewing its deal with Intralot to secure the provision and maintenance of a new central hardware and software system.
OPAP’s current contract with Intralot expires in July. The new deal, which will cost it a total of 109 million euros, is subject to shareholder approval on March 26.
The deal will cut average monthly payments to 3.4 million euros from 5.3 million euros, OPAP said in a document specifying the terms of the new deal.
OPAP said it will pay a total of 79.2 million euros to Intralot for the services, excluding VAT, and incur one-off capital expenditure of 29.5 million euros under the new deal which expires in July 2018. It will also book a 46 million euro total charge for two years for terminals at its 5,000 outlets.
Under the previous deal, OPAP paid 57 million euros annually for its central system and the terminals. Intralot also received an 8 percent fee on the firm’s revenues from some of its games.
Debt-laden Greece is due to sell almost its entire 33 percent stake in OPAP, worth nearly 700 million euros according to its market capitalisation on Wednesday.
Seven investors, including a Chinese conglomerate and a big U.S. private equity fund, have been short-listed and are expected to submit binding bids next month.
The company holds a national monopoly on sports gambling until 2020 and is one of Europe’s biggest listed betting firms with annual sales of about 4 billion euros.
Intralot, one of the world’s biggest gaming software providers, has been OPAP’s IT contractor since at least 2001, when OPAP was listed on the Athens bourse.
OPAP’s shares were unchanged at 6.60 euros at 1119 GMT, while Intralot’s were also flat at 2.06 euros.