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GTECH Rethinks Rhode Island Investment

RHODE ISLAND – As reported by the Providence Journal: "Citing the casino legislation in front of the General Assembly, GTECH Holdings Corp. is reviewing its planned investments in Rhode Island -- including its proposed $88.5-million corporate headquarters in downtown Providence.

"GTECH says the two casino bills before the General Assembly do not guarantee that it can operate slot machines in the proposed West Warwick casino, contradicting a contract the company signed with the state last year.

"Last year, the state gave GTECH a 20-year deal to run the Rhode Island lottery, which includes operating video slot machines at Newport Grand and Lincoln Park, with the company keeping a portion of the sales. The contract also guarantees that GTECH can operate the the lottery's slot machines at any new gambling facilities.

"…Last year, when GTECH negotiated its contract to become the exclusive lottery provider to the state, the possibility of a casino was discussed. Provisions were included in the contract for protecting GTECH's revenue stream if a casino significantly decreases its take at the state's two existing gambling parlors. GTECH operates nearly half the video-slot machines at Newport Grand and Lincoln Park.

"However, according to GTECH, those provisions were not taken into consideration during the drafting of the casino legislation. The Senate and the House are expected to vote on bills today and tomorrow, respectively, that would allow a statewide referendum in November on the casino that Harrah's Entertainment is seeking to build.

"…As far as GTECH is concerned, when the General Assembly drafted the casino legislation it did not hold up its end of the deal…"

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