Camelot Group

Infobox Company
company_name = Camelot Group
company_
vector_
company_type = Public^{Note A}
foundation = March 27 1993
location = Watford, United Kingdom
origins =
key_people = Dianne Thompson (CEO)
area_served = United Kingdom
industry = Lottery
products = National Lottery^{Note B}
revenue = profit £4.776 Billion GBP
operating_income = profit £47.2 Million GBP
net_income = profit £32.4 Million GBP
num_employees = 900
parent =
subsid =
homepage = http://www.camelotgroup.co.uk
footnotes =

Camelot Group plc^{Note A} are the operators of the UK National Lottery. Camelot Group was awarded the National Lottery franchise in 1993 [ [http://www.iht.com/articles/1994/05/26/bet.php International Herald Tribune] ] (though the lottery didn't start until 1994) and was re-awarded the franchise in 2001. Each franchise period runs for 8 years with the next franchise starting in 2009. The Government body "The National Lottery Commission" is responsible for deciding who is awarded the franchise. The way the franchise was awarded to Camelot in 2001 caused some controversy due to the state owned Royal Mail owning a 20% stake in Camelot Group. [http://news.bbc.co.uk/1/hi/magazine/3975517.stm BBC News Online] November 3 2004]

2000/2001 Franchise Controversy

There were 2 companies competing for the National Lottery franchise in 2001, Camelot, the incumbent operator and a rival operator organised by Sir Richard Branson called "The People's Lottery".

During the 2000 franchise bidding process, a technical problem with lottery terminals supplied by American company GTECH Corporation came to light. It was discovered that this technical problem may have inadvertently caused winners to be paid incorrect amounts and it was this problem and the relationship between Camelot and GTECH that saw the National Lottery Commission recommend the lottery franchise be awarded to "The People's Lottery". GTECH originally were a shareholder in Camelot Group but they later sold their shareholding to Camelot Group with the remaining shareholders increasing their stakes from 16.66% to 20%.

In August 2000 the chair of the National Lottery Commission, Dame Helena Shovelton stunned both parties when she announced that neither party would be invited to run the National Lottery, claiming that neither party met the statutory requirements to run the lottery. It was felt legal problems were responsible for the downfall of The People's Lottery bid whilst the relationship between G-Tech and Camelot was the reason Camelot would not be invited to run the lottery. Despite the fact that neither bid met the statutory requirements, the Commission still tried to award the franchise to The People's Lottery.

By September 2000 it was clear that despite neither party meeting the statutory requirements to run the lottery, the Commission was going to award the franchise to The People's Lottery. It was at this point that Camelot initiated legal action, taking the Commission to the high court for a judicial review. The High Court judges sided with Camelot, describing the Commissions decision as "conspicuously unfair". The National Lottery Commission responded by dismissing the Treasury legal team who had been advising them. Dame Helena resigned shortly afterwards and was replaced by Lord Burns.

During November, the National Lottery Commission reopened the bidding process and both parties resubmitted their bids, the commission hoped to announce the winner by mid-December. On December 19 2000 the commission announced that Camelot would be awarded the franchise, with voting 4-1 in favour of Camelot [ [http://www.guardian.co.uk/society/2000/dec/19/lottery2] ] . One member would later resign from the commission over the whole process, deeply unhappy that Camelot had been reawarded the franchise. It was during the second bidding process that Camelot agreed to buy out shareholder G-Tech's stake in the company. Sir Richard Branson threatened to take further legal action but faced with the prospect of a lengthy and costly legal battle, one which could have eventually resulted in The National Lottery games being suspended, he backed down.

Shareholders

Following GTECH being bought out by Camelot in 2001, there are now 5 equal shareholders, all of whom have been shareholders in Camelot since the company was founded in 1993.

*Cadbury Schweppes
*Thales Electronics plc (Shareholder since 2000 following takeover of Racal)
*Fujitsu Services Ltd.
*Royal Mail Enterprises Ltd.
*De La Rue Holdings plc

Income

For every pound spent on the National Lottery, it is split in the following way

*50p → Prize Fund
*28p → Good Causes
*12p → Government
* 5p → Retailers as Commission
* 5p → Camelot
** 4.5p → Camelot for Operating Costs
** 0.5p → Camelot for Profit

References and Notes

* [http://www.camelotgroup.co.uk/aboutcamelot/2005Annualreportandfinancialstatements.pdf Camelot 2005 Annual Report]
* [http://news.bbc.co.uk/1/hi/uk/1076653.stm BBC News Article, Dated January 10 2001]

*^{Note A} Although Camelot is a public limited company, it's entire share issue is owned by 5 companies, as detailed above.
*^{Note B} The National Lottery brand is owned by The National Lottery Commission and licenced to Camelot as part of the franchise agreements under which Camelot operate The National Lottery.

External links

* [http://www.camelotgroup.co.uk/ Camelot Group website]
* [http://www.natlotcomm.gov.uk/CLIENT/index.asp UK Government agency website]
* [http://www.national-lottery.co.uk/ National Lottery website]