Allwyn’s NYSE Presentation Raised Concerns of Links to Russia

Allwyn’s NYSE Presentation Raised Concerns of Links to Russia

An investor presentation for Allwyn Entertainment, the winner of the contract to run the UK National Lottery from 2024, is raising concerns that the business may be impacted by the sanctions imposed on Russia, reported PA Media.

Reflection on Current Global Climate

Allwyn is about to go public on the New York Stock Exchange via a merger with a special purpose acquisition company and during the presentation for investors, the UK’s next National Lottery operator warned: “The conflict between Russia and Ukraine, and related sanctions could negatively impact us.”

Further, Allwyn is considering the conflict among the risk factors that could adversely affect its operations as it has already destabilized “market and economic conditions” and would probably “have additional global consequences.”

“The potential impact of sanctions is a standard risk factor that virtually every US listed company with international operations is making in light of the invasion of Ukraine by Russia,” said a spokesman for Allwyn, outlining that the “inclusion of sanctions as a risk factor… is a reflection on the current global climate,” and not necessarily “an indication of a specific threat to Allwyn.”

Joint Venture with Gazprom

Allwyn won the competitive bid for the lottery last month but questions over links between the company’s owner, Czech billionaire Karel Komarek, and Russian gas giant Gazprom have been raised in the UK Parliament by Labour MPs concerned that the Gambling Commission might have awarded the next National Lottery license to an operator with reported links to the Russian regime.

Alex Davies-Jones expressed his concerns in the House of Commons, asking the government: “Given the extremely concerning situation in Ukraine, can the minister confirm he is confident that the new provider has no links to the Russian regime, and if so – why?”

Chris Philp, Parliamentary Under-Secretary of State at the Department for Digital, Culture, Media and Sport (DCMS) referred to the statutory obligation of the Gambling Commission to “make sure that anyone given a license meets the fit and proper person test” as part of the license awarding process, and that the Commission assured him that Allwyn pass the test and a security vetting process is underway.

Concerns arise due to the joint venture between Allwyn’s sister company MND and Gazprom in the Czech Republic which runs a gas storage facility in the country but Komarek has reportedly started looking for ways to cut his ties with Gazprom and end the Russian firm’s involvement in the venture. Komarek also condemned the Russian invasion of Ukraine.

Following the successful bid for the National Lottery led by the CEO of the London 2012 Olympics Sir Keith Mills and former Sainsbury’s executive Justin King, Lord Seb Coe is expected to join the board at Allwyn.

Author: Ian Douglas