Paddy Power agrees online deal with Canadian lottery operator

PADDY POWER has signed a three-year deal with British Columbia Lottery Corporation that will see the firm work with the Canadian lottery operator’s online sports betting business.

Under the agreement, Paddy Power will provide product, pricing and risk management services from the summer.

Paddy Power chief executive Patrick Kennedy said this was the company’s first transaction in North America.

The region is expected to be of “increasing strategic importance” to Paddy Power in the future.

The bookmaker has already received approval from the Gaming Policy and Enforcement branch of British Columbia to provide the services.

Analysts focused on the wider strategic significance of the deal.

Goodbody analyst Gavin Kelleher said the announcement was a positive step for Paddy Power, although the financial impact to the group was likely to be limited, given the small size of the British Columbia betting market.

Mr Kelleher put more importance on the deal showing the group’s ability to gain approval from regulators, and the fact that it was a deal with a large lottery operator.

“In addition, regulatory change in BC could allow for more products to be allowed in the future,” he said.

The deal comes a month after Paddy Power appointed Eamonn Toland as its full-time head of operations in North America.

“Combined, these announcements provide a clear signal of the group’s intent to ramp-up its activity in the region. As US states and Canadian provinces continue to explore regulatory options in relation to sports betting in the years ahead, we believe that Paddy Power has the opportunity to considerably expand its operations there,” Davy analyst David Jennings said.

“In our view, lottery operators will represent a big target audience for Paddy Power as further markets regulate globally.

“Therefore, having a well-recognised lottery operator already on board should provide another calling card for the group elsewhere,” Mr Jennings said.

Shares in Paddy Power closed at €39.485 on the Dublin market yesterday, down 0.8 per cent.