UK-listed operator and supplier of pools and tote betting services Sportech has signed an agreement with Southern California Off Track Wagering Inc (SCOTWinc) which will allow the company to operate up to ten horse race betting retail venues across the state of California.
SCOTWinc is a partnership of Southern California racetracks and horsemen that manages the off-track wagering locations where customers can bet and watch horseracing. It has granted Sportech a licence to allow the company to offer customers the ability to bet on horseracing in high-end sports bars and restaurant facilities.
Sportech said that the deal enables it to expand its established sports bar and betting business in Connecticut to California, a state in which the company’s technology systems process all bets on horseracing (which exceeded $2bn in total value last year).
According to Sportech, there are currently only 36 locations in California where a bet may be placed on horseracing, with this agreement “significantly” expanding its footprint “while attracting new fans and revenues to the sport.”
Sportech CEO Ian Penrose said: “We are delighted to have received approvals to develop a branded sports bar and betting retail chain. We have worked closely with the horseracing and licensing authorities in California for a number of years, and I am pleased that we have reached this important milestone. We look forward to establishing a dynamic and successful venture.”
The company will open the first sports bar, restaurant and betting venue at a location in the City of Norco, Riverside County, Southern California. The California Horse Racing Board (CHRB) approved the proposal last week, following Sportech's receipt of all relevant approvals from the City of Norco.
The proposed 10,000 square feet purpose built facility in Norco is scheduled to open in the summer of 2014 and will combine state-of-the-art betting technology with food and beverage retail operations.
The location will be developed under a joint venture between Sportech and the Silky Sullivan Group LLC, a food and beverage operator based in Southern California. The joint venture will share equally the cost of construction (estimated at $1.6m for Sportech) and the profits generated.
Phil Balderamos, managing director of Sportech Venues California said: “We have been working on developing this new area of business for 12 months, to build on our core strengths of processing all betting on horseracing in California. We look forward to expanding the distribution, appeal and revenues of horseracing with this innovative concept.”
Sportech and SCOTWinc have already partnered to open five locations in Southern and Central California, where Sportech provides betting technology and services for customers of third party sports bars to place bets.
Jack Liebau, chairman of SCOTWinc added: “We are pleased to be working with Sportech to create these new first class facilities in order to showcase the great sport of horse racing and to attract new customers."
Sportech Venues currently owns and operates fifteen off-track betting locations in Connecticut, many of which offer full service restaurants, sports bars and entertainment.
Shares in Sportech plc (Co. Data) (AIM:SPO) are currently trading at 85.25 pence per share in London this morning following the announcement.