October 12, 2012

State Lottery Commission executes 15-year integrated
services agreement with GTECH Indiana, LLC

INDIANAPOLIS – The State Lottery Commission of Indiana today announced it has executed a 15-year integrated services agreement with GTECH Indiana, LLC that will provide the Hoosier Lottery with operational assistance and result in a projected $2.1 billion gain for the state of Indiana.  

The Commission entered into contract negotiations with GTECH following the Oct. 3 public meeting of the State Lottery Commission, during which the Commission approved GTECH as the Lottery’s selected provider. A Request for Information process, which was initiated by the Commission May 16, resulted in the recommendation of GTECH to the Commission at the Oct. 3 meeting.

“The goal of this process was to create a positive working relationship with a provider that could substantially improve the performance of the Hoosier Lottery, and the post-selection negotiation spoke volumes about GTECH’s commitment to our goal,” said Hoosier Lottery Executive Director, Karl Browning. “Our selection team was clearly impressed by GTECH’s business plan, as was the Commission, and the credibility of that plan paved the way for a smooth negotiation over the past several days.”

Under the terms of the agreement, GTECH will assume day-to-day administration of the Hoosier Lottery’s marketing, sales, distribution and customer service operations on or about Feb. 1, 2013. Within those functional areas, GTECH will specifically administer marketing, advertising, game development, retailer recruitment and training, instant ticket management and distribution, supply of goods and services, subcontractor and vendor selection and management, and call center operations.

The State Lottery Commission will continue to maintain control over all significant business decisions and will have the authority to approve GTECH’s annual business plan each year before it can be implemented.

In return for its services, GTECH will be compensated through the ability to earn incentive compensation for performance above its targeted income threshold. Conversely, GTECH will be penalized for achieving results below its targeted income threshold. Both bonuses and penalties are limited to an amount equal to five percent of the target income threshold.

GTECH’s new Indiana entity, which will now begin the transition toward integrating into the Hoosier Lottery operation, will be led by Connie Laverty O’Connor – a 32-year lottery veteran who recently served as CEO of Northstar Lottery Group in Illinois and held senior management positions at lotteries in New York and Georgia.

“Our experience in managing a U.S. lottery’s transition from a State-executed model to an integrated services model will be brought to bear in Indiana, particularly as we begin the ramp-up phase,” said Laverty O’Connor, CEO of GTECH Indiana LLC. “Working hand-in-hand with the Hoosier Lottery, we will build a world-class team aligned around a common goal - a commitment to delivering incremental revenues to the residents of Indiana.”

GTECH’s initial business plan for fiscal year 2014, which has been approved by the State Lottery Commission, will be integrated into the Hoosier Lottery operation beginning July 1, 2013.

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For more information, please contact Al Larsen at alarsen@hoosierlottery.com or 317-264-4805.

 

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