Pacific Online gets lease extension

Online lottery equipment provider Pacific Online has secured a one-year extension of its equipment lease agreement with the Philippine Charity Sweepstakes Office (PCSO), ensuring a lifeline for the near term.

In a disclosure to the Philippine Stock Exchange on Friday, Pacific Online said the term of the equipment lease agreement had been extended for a maximum period of one year beginning Aug. 1, 2019.

“The extension is a stop-gap measure to ensure the unhampered lotto operations of PCSO and to allow it to complete the procurement or bidding process for a new PCSO lottery system,” Pacific Online said in a disclosure to the Philippine Stock Exchange on Friday.

All other terms of the existing agreement remain unchanged, the disclosure said.

Pacific Online is the lessor of the online lottery system being used by PCSO for its lotto operations in Visayas and Mindanao, while its subsidiary, Total Gaming Technologies Inc. (TGTI), is the equipment lessor for PCSO’s Keno game nationwide.

On July 26, President  Duterte suspended all gaming operations of the PCSO, citing rampant corruption.

The ban on lotto was lifted four days after.

Shares of Pacific Online rose by 3.33 percent to close at P2.79 a share on Friday after the interim deal was announced.

This gave it a market capitalization of P2.4 billion.

Shares of Premium Leisure Corp.. which owns 50.7 percent, were flat while its ultimate parent firm Belle Corp. added 0.44 percent on Friday.

Prior to Mr. Duterte’s pronouncements against PCSO, Pacific Online was already in discussions for the extension of this agreement ahead of the July 31 expiration.

During the public bidding initiated by PCSO in May 2019 for the procurement of a new online lottery system, both Pacific Online and competitor Philippine Gaming Management Corp. (PGMC), a unit of publicly listed Berjaya Philippines Inc., failed to fully comply with all of the bidding requirements.