Sérgio Takemoto, the President of the National Federation of Staff Associations of Caixa Econômica Federal (Fenae), has formally requested that the public bank should take over the operations of Brazil’s new instant lottery, Lotex.
Lotex was scheduled to launch on September 21, but the Estrela Instantânea consortium that was expected to operate it decided to terminate the contract.
Rita Serrano, Director of Caixa, has also assured that the concession “was a mistake from the beginning”, according to a report in Games Magazine Brasil.
The operating group, a consortium comprising Scientific Games Corporation and IGT Plc, wanted to strike a deal with Caixa to distribute Lotex in the 12,000 official lottery agencies managed by the public bank.
After a negative response, Estrela Instantânea decided to withdraw from the process, but said that it is willing to renegotiate the contract in the event of an agreement with Caixa.
Michael Conforti, Head of Global Strategies at Scientific Games, said: “Should the Government of Brazil consider an extension of the process for Caixa to authorize and execute a contract because of the high contribution potential of this venture to a number of government programs, we will explore the possibility of re-engaging in the process.”
After the suspension of the Estrela Instantânea contract, both Caixa representatives proposed to get involved in the Lotex operations. They highlighted that the operations require the sale of tickets at Caixa’s shops that are already established throughout the country.
Serrano added: “Caixa should be in charge of this business, instead of helping a private competitor sell the tickets. It would accelerate the end of public lotteries. The agreement was only beneficial for [private] companies. Instead of investing money in a new marketing network for Lotex, they wanted to make a profit through Caixa. That’s crazy.”
Takemoto believes that the withdrawal of the companies should be seen as something positive as it paves the way for Caixa to take over.
Takemoto said: “It’s a possibility and it’s what we want. The funds raised by Caixa lotteries are a crucial source for the social development of the country. When Caixa was in charge of latex in 2019, around 40% of revenues were sent to social programs, while with the consortium in place, only 16.7% would be transferred to the Union.”
Serrano also supported the proposal, adding: “If the private consortium needs the lottery network and uses this as an excuse to end the contract, why isn’t Caixa itself in charge of the operations? It has the experience, the capacity and the retail shops. What we can’t accept is that an international consortium wants to use an established system without investing. It had already accepted the terms of the concession.”