PROVIDENCE – International Game Technology PLC and Twin River Worldwide Holdings Inc. have reached an agreement on a joint gaming venture in the state, the companies announced on Thursday.
The deal, which needs General Assembly approval, could end their public feud over a proposed 20-year extension of IGT’s contract running the Rhode Island lottery. Twin River had been urging the state to give it and proposed partner companies control over the state lottery instead of IGT.
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The deal would create a joint venture between IGT and Twin River that will oversee creating and maintaining the state’s gaming-machine offerings at Twin River casinos. The venture would be owned 60/40 by IGT and Twin River, respectively. It would begin Jan. 1, 2022.
The companies said they envision their plan being introduced to the General Assembly as one comprehensive piece of legislation.
The R.I. Lottery would continue its oversight and regulation of all gaming; other aspects of the lottery not related to VLTs would remain unchanged.
Twin River is seeking a two-year license as a technology provider, from July 2020 to Jan. 1 2022. The company is also seeking to amend its current contract, which extends to 2030 to 2043, to mirror the proposed 20-year IGT contract.
Despite the agreement, the implementation of the companies’ plans were said to be contingent on the approval of all components of the deal, saying they, “must be approved for the overall proposal to become effective.” The contract’s navigation through the General Assembly, therefore, will have an effect as to whether the peace between the companies actually comes to fruition.
The announcement was praised by Senate President Dominick J. Ruggerio and House Speaker Nicholas A. Mattiello, although they noted that any proposal will need to be vetted in both chambers.
“This announcement signals the start of a strong three-way partnership that includes not just the two companies, but the state … as well,” said Robert K. Vincent, chairman of IGT Global Corp. “Importantly, it will harness the strongest attributes of each company to better serve Rhode Island taxpayers, to preserve valuable jobs and to make meaningful infrastructure improvements at the gambling facilities. We appreciate the active involvement of the executive and legislative branches of government for encouraging both organizations to work together in such a unique and highly effective manner.”
The combined company to be owned by IGT and Twin River would create a licensed video lottery terminal provider and supply the entirety of games to the lottery in the state. Twin River will also seek a license as a technology provider and aims to acquire 23% of the slot floor from existing vendors.
IGT and other manufacturers would supply the casinos with machines based on an efficiency rating system, with IGT starting with 40% of the floor.
The deal between the two companies would also set up a system for replacement cycles for VLTs in Twin River properties and requirements for the minimum amount of “premium machines” offered. Maintenance of machines and the introductions of new machines was one of Twin River’s primary complaints of the proposed structure and it had argued that IGT controlled too large of a share of VLT machines in its casinos.
IGT’s proposed contract would be similar to the one previously proposed, committing to 1,100 jobs in Rhode Island with an aggregate annual payroll of at least 250% of minimum wage, an investment of $150 million and a payment of $25 million in license fees. Twin River would pay $6.5 million of the license fees, per the new deal.
The proposal also includes a 18-month renovation and expansion of Twin River Casino Hotel in Lincoln, including 40,000 square feet of additional floor gaming space, the addition of a spa to the hotel and removal of gaming machines on the casino’s second floor for an entertainment concept to be announced at a later date. Investments for the expansion, including technology, were projected to be over $100 million.
The changes were said to be part of the companies’ effort to combat rivals in an increasingly competitive New England casino market.
“We all recognize the New England gaming landscape has changed significantly in just the last short five years, and our players have more choices. It is crucial that not only the gaming floor in Rhode Island be as vibrant and content-driven as our competitors, but that the wider range of amenities also meet our customer’s expectations,” said Marc Crisafulli, executive vice president of TRWH and president of the Rhode Island casinos. “Both the state and IGT indicated that substantial investment in the facility would be helpful, and we heard them loud and clear.”
Twin River also announced it would commit to a 12,000-square-foot headquarters in Providence, saying it is looking for alternatives to its current lease at 100 Westminster St.
Chris Bergenheim is the PBN web editor. You may reach him at Bergenheim@PBN.com.
