Scientific Games Strengthens Latin American Presence through Provoloto Acquisition

NEW YORK, NY – June 11, 2012 – Scientific Games Corporation (Nasdaq: SGMS) announced today the completion of its acquisition of Provoloto (Grupo Provo), a lottery company that distributes instant tickets for nearly 30 Mexican charities to approximately 17,000 retailers.  Provoloto has been a Scientific Games Latin America customer since 2003 and has been developing and distributing instant lottery games in Mexico for 15 years.  Scientific Games will continue to print Provoloto tickets from its plant in Santiago, Chile, while maintaining Provoloto’s existing infrastructure, including its facility, distribution network and management team in Mexico.

 

Provoloto is one of the four major lottery companies in Mexico, which has a population of over 113 million people. Total Mexican lottery sales in 2010 were estimated to be $1.3 billion, of which approximately $76 million were generated by the sale of instant tickets.  This equates to over $11.00 in per capita lottery sales, with only $0.67 in per capita instant ticket sales.

 

“Instant ticket sales in Mexico currently represent less than 10 percent of total lottery sales, compared to nearly 60 percent in the U.S.,” said John Schulz, Vice President, Cooperative Services for Scientific Games.  “Having a more central role in the Provoloto business should allow us to incorporate some of our proven instant ticket best practices and bring Mexico’s instant ticket sales more in line with sales of its other lottery products.  By introducing new products, improving marketing and eliminating some of the manual processes in place today, we believe we can produce significant instant ticket growth and provide greater returns to charities.”

 

“Provoloto has built a strong foothold in the Mexican marketplace over the past 15 years by capitalizing on their longstanding local relationships in order to provide much needed funding to deserving charities,” said Luke Weil, Vice President, International Business Development – Latin America, for Scientific Games.  “For Scientific Games, the acquisition of Provoloto is a natural fit and the perfect opportunity to demonstrate how the best practices we use around the world may be successfully deployed in Latin America.”

 

“We are extremely pleased to become a part of Scientific Games.  Not only do they have 40 years of experience in game design, marketing, research, systems, and security - they have also been our instant ticket supplier for nearly a decade, which means they know our company and the marketplace extremely well,” said Ventura Martinez del Rio Requejo, Chief Executive Officer of Provoloto.  “We look forward to working together with Scientific Games to market and deliver exciting and differentiated instant games that will further benefit the charities we support.”

This transaction is not expected to have a material impact on Scientific Games’ results of operations for the fiscal year ending December 31, 2012.