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Brazil – President predicts Lotex sale by end of year

By - 8 June 2017

According to the Gilberto Occhi President of the largest state owned bank and lottery operator – the Caixa Econômica Federal (CAIXA) – the instant lottery division arm of the lottery will be sold off by the end of this year. “The deal is moving forward, I think we’re going to obtain the sale by December,” said Mr. Occhi.

The Brazilian Development Bank (BNDES) a federal public company associated with the Ministry of Development, Industry, and Trade and the main financing agent for development in Brazil will oversee the privatisation of Lotex – CAIXA’s instant arm. President Michel Temer issued a decree in October transferring the responsibility for managing the privatisation process of Lotex to both the BNDES and the Ministry of Finance. According to estimates released by the Federal Government’s Investment Partnerships Program (PPI) the sale of Lotex will generate around R2.2bn for the government.

The news follows the announcement in September last year that the instant lottery ticket arm of CAIXA – would be auctioned off as part of a 25 point plan designed to kick-start the economy. It is believed that the licensing process for Lotex could begin in August and the auction could go ahead in November. However the tender could go ahead a month before so that the new privatised version of Lotex could well be in operation by the first half of 2018. Meanwhile CAIXA will continue to run and operate traditional lotteries such as its most popular lottery the Mega-Sena.

The sell off comes at a time when lottery revenues are down. According to the Secretary for Economic Monitoring in a report released in January funds generated by CAIXA lotteries reached R$12.8bn a 13.8 per cent decrease compared to 2016 when the figure stood at R$14.9bn. According to The Secretary for Economic Monitoring, which is part of the Ministry of Finance, the decrease was due to the downturn in the Brazilian economy in 2016.

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