Yesterday, the Ontario Lottery Gaming Corporation (OLG) has put the wheels in motion after signing a 22-year deal with Great Canadian Gaming Corporation (“Great Canadian”) and Brookfield Business Partners LP (“Brookfield Business Partners”). Under the recently signed deal, Great Canadian and its partner Brookfield are to take over certain gaming assets in the Greater Toronto Area (the “GTA Bundle”). The GTA Bundle is considered to be the largest award by OLG as part of the modernization of its casino operations.
The prospects of modern gambling facilities in the Greater Toronto Area got a little closer yesterday, as OLG put its signature to a 22-year casino operating and services agreement with the two partners Great Canadian and Brookfield. Since yesterday, the two companies are the new service providers for the gambling facilities included in the GTA Bundle.
The GTA Bundle is comprised of OLG Slots at Woodbine, OLG Slots at Ajax Downs and Great Blue Heron Casino. In other words, the two companies have assumed control of a combined total of over 4,000 slot machines and 60 table games. Apart from that, these facilities generated approximately C$1 billion in gross gaming revenue in fiscal 2017. In addition to that, there are more than 2,200 people employed in maintaining the gambling facilities in the area.
OLG Awards Fifth Gaming Bundle
Last year, OLG (the area’s largest potential source of non-tax revenue) announced that Great Canadian and Brookfield are the successful proponents to take over the day-to-day operations of the gambling facilities included in the GTA Bundle. The two companies paid approximately C$170 million to win the bidding process for the GTA Bundle. Great Canadian and Brookfield Business Partners each hold a 49% interest in the Ontario Gaming GTA LP, while Clairvest Group Inc. holds 2% interest. The partners announced that they intend to invest in updating the gambling facilities in order to attract new players and keep the old ones coming back.
Some time ago, OLG announced its intentions to privatize its gambling properties in an attempt to modernize the old-dated gambling venues and rake in more revenue to support local economies. The GTA Gaming Bundle is the fifth bundle to be entrusted in the hands of a private company.
Great Canadian is one of the largest gambling operators in the area. The company operates 22 gaming properties, including River Rock Casino in Richmond. As it can be recalled, last year River Rock was blasted for allegedly being used by criminals to launder dirty cash. However, the company behind the casino poured cold water on all the speculation, announcing that it is not under criminal investigation. After the announcement of the closed acquisition deal, shares in Great Canadian increased by 1.6%.