Aussie firm plans gaming R&D unit - Tuesday 12th of April 2005

The $25-billion Tabcorp, Australia???s premier leisure, gambling and entertainment group, is planning to establish a research and development centre in India ???to develop gaming technology???.

???We are quite seriously exploring the possibility. It will come up in less than six months from now either in Mumbai or Delhi....most likely Delhi,??? said Matthew Slatter, managing director and CEO of Tabcorp.

Establishing the research centre with a small headcount of approximately 30 software developers, the world???s fourth largest gambling company has plans to export this technology to North America and Europe.

The company has asked international consultants PricewaterhouseCoopers to conduct a feasibility study for the R&D centre.

While refusing to spell out how much the company planned to invest in India, Slatter said, ???The cost advantage of setting it up in India vis-??-vis any other part of the world is nearly 30-40 per cent.???

Slatter said Tabcorp currently invests $100 million annually to develop similar gaming technology in Australia alone. Investment in India will give additional capacity.

Due to socio-cultural values prevalent in the country, India has not encouraged playing casino or gambling. According to laws, foreign direct investment is not permitted to establish casinos.

Slatter, who is in India on his first trip to suss out business opportunities, has already managed to meet Union finance minister P. Chidambaram, commerce minister Kamal Nath and Dayanidhi Maran, minister for communications and information technology.

???We were very pleased with the meetings. However, we don???t think that the concept of casino is on the government???s priority list. It will take sometime,??? he said.

???But it is alright since we are a long-term player,??? said Slatter.

While Tabcorp is at present not considering expanding to India in spheres of hospitality, wagering or gaming, he said, ???We may start discussions in a couple of other areas in about two years. At the moment, we are looking at taking small steps.???

While Indians are ???relatively small customers??? in the casino market, the maximum interest in the game has been generated by Southeast Asians and Chinese, he said.

Besides eyeing India as part of its overseas expansion strategy, Tabcorp has also put in a proposal to own an integrated resort that will entail an investment of $2.5 billion in Singapore.

???The resort will encompass hotels, multiple restaurants, casino and theatre among other things. It may also be a joint venture,??? added Slatter.

Tabcorp, which is capitalised at $7 billion, has been growing at over 10 per cent each year over the last 10 years, he said.

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