It has taken a global pandemic to make many companies reconsider the direction in which their businesses are heading. Many industries have had to rethink the way they get their products and services to customers, including the South African gambling industry. It was in with that mindset that Tsogo Sun made the decision to gain a foothold in the South African online betting industry. To do so, the group announced that it would be acquiring a 50.1% stake in Bet.co.za. The purchase is being made via Tsogo Sun’s subsidiary Alternative Gaming and the group is paying R49 million to become a major stockholder in South Africa’s premier sports betting and entertainment site.
Tsogo Sun Gaming made an announcement to its shareholders regarding the purchase on Friday, in which it said: “The acquisition represents a strategic opportunity for Tsogo Sun Gaming to enter the online betting space via an existing, developing business.”
Tsogo Sun Hinted at Acquisition in June
In June this year, as Tsogo Sun was struggling to assess the damage caused by a two-month lockdown period of its land casinos across South Africa, the group’s CEO said that the group was “in an advanced stage of entering the online betting industry.” The group reported revenue of R11.7 billion in the 12 months ending March 31, 2020 – just 1% up from fiscal 2019. While earnings rose 3%, profits fell a dismal 83% to just R277 million. It was clear that the profit decline was due to a R2 billion write-down on Tsogo Sun’s business value, as a direct result of the novel coronavirus.
Tsogo Sun operates 13 casinos in South Africa, as well as several V-Slot Halls and over 20 Galaxy Bingo halls. With Tsogo Sun struggling to cut costs and trying to recover from lockdown, CEO Chris du Toit said the group believes that shifting some operations online would be “a natural progression for casinos to offer products online, and if done responsibly on licensee level, can protect the substantial investment and jobs created by casinos.”
Online Gambling in South Africa
South Africa’s gambling laws allow online sports betting, but has not yet legalized online casinos within its borders. That hasn’t stopped millions of South Africans playing at regulated online casinos that are based “off-shore” and which market their games and services to the local market. At these online casinos, players can pay in ZAR and have access to safe and easy SA-friendly banking methods. Some online casinos, such as Springbok Casino, even offer customer support in English and Afrikaans.
Bet.co.za is considered South Africa’s premier sports betting platform, with licenses from gambling authorities in Limpopo and Gauteng. It was founded just after the 2010 World Cup which took place in South Africa. ”We may look like a bookmaker on the surface, but that’s not who we are underneath,” says Bet.co.za in its About US section. “We’re a sports company first and foremost, who just so happens to deal in betting. We’re out to enhance the sports-watching experience. To increase the excitement on the match.”