Gillon McLachlan discusses Tabcorp CEO role as Blackstone job emerges

Former AFL chief Gillon McLachlan has discussed the position with Tabcorp’s board, and could be confirmed in weeks, but an advisory role with Crown Resorts’ owner may complicate things.

Tabcorp is seeking a level playing field in NSW.

Gillon McLachlan has held discussions about being appointed as the chief executive of Tabcorp, and is also set for an advisory job with private equity giant Blackstone.

Mr McLachlan, the former CEO of the AFL has discussed the role with the Tabcorp board in recent days and is being courted by the wagering giant’s management to take the job that has been vacant since Adam Rytenskild resigned suddenly in March.

Tabcorp is currently being led temporarily by executive chairman Bruce Akhurst, who dealt with Mr McLachlan and the AFL during his days as a senior executive at Telstra when the telco held broadcast rights for the sport.

On Friday though, it was confirmed that Mr McLachlan has been hired as a senior adviser to private equity giant Blackstone, the owner of Crown Resorts.

Blackstone employs adviser in locations around the world on a part-time basis and Mr McLachlan was the first tapped for such a role in the Australian market.

It is expected he will work closely with the head of Blackstone’s Australian private equity unit, Michael Blickstead, along with its real estate boss, Chris Tynan.

Mr McLachlan has been heavily linked with Racing Victoria’s chairman role, but it also emerged on Friday that he would not be among the governing body’s board new appointees by the state’s racing minister Anthony Carbines.

That has left Mr McLachlan clear to take the Tabcorp role should he accept it, and for which he is now considered the strong favourite, although he may not keep the Blackstone role if that move were to take place.

Tabcorp and Mr McLachlan, who left the AFL at the end of the 2023 season after more than nine years at the helm, would not comment on Friday.

The gaming company’s shares closed 10 per cent higher on Friday at 66c.

Meanwhile, the NSW government will consider tax and regulatory changes to the wagering sector proposed by Tabcorp as the gambling giant battles to compete with online competitors.

Gaming and Racing Minister David Harris said reforms could include changes to the point of consumption tax to align with other states that charge 20 per cent.

NSW currently charges a 15 per cent tax on gross profit from all bets made in NSW, including online bets.

Tabcorp has called for a national level playing field against online competitors such as Sportsbet and Ladbrokes that still enjoy lower taxes in key markets.

Tabcorp warned that it was being hit with higher taxes in NSW and South Australia, a hangover from when online bookies did not exist and it held a retail monopoly.

Tabcorp, which has a substantial network of betting shops, pays double the wagering fees and taxes of bookies like Sportsbet and Ladbrokes that are only licensed in the Northern Territory and only pay a point of consumption tax on a state-by-state basis.

Queensland and Victoria have made tax changes where all companies pay the same, with other states currently looking at the “level playing field” concept.

The NSW tax regime was introduced in 1997 when Tabcorp held 100 per cent of the market compared to 25 per cent now.

NSW Minister for Gaming and Racing David Harris.

Sportsbet said it pays more than $300m in direct taxes, levies and fees in NSW as part of almost $1bn economic contribution to the state.

Nationally, it contributes more than $1.2bn in taxes and fees to governments and sporting codes. Online wagering service providers pay a flat 15 per cent point of consumption tax rate directly to government as well as race field fees to the racing codes.

The NSW government says it will establish a formal process to consider Tabcorp’s proposal, which will include engaging with relevant racing industry bodies.

Mr Harris said any changes would ultimately be considered based on value for money, benefits to the NSW taxpayer and the ability to secure a sustainable future funding model for the NSW racing industry.

In a statement to the ASX, Tabcorp says if the reforms were implemented they would “create a level playing field and modernise retail exclusivity, similar to recent reforms in Victoria and Queensland”.

“This is a positive step towards ensuring the sustainability of the NSW racing industry,” the wagering giant said, promising to work “constructively” with the government and the industry through the process,” it said.

Mr Harris said the NSW racing industry generated billions of dollars for the NSW economy and sustained tens of thousands of jobs.

“This includes all those who make a living from it and participate in it. But we must be satisfied the proposal meets the interests of both the wider community and the racing industry and its stakeholders, before we consider implementing any elements of it,” he said.

NSW Treasurer Daniel Mookhey said gambling companies should always pay their fair share.

“The NSW government will apply strict scrutiny to Tabcorp’s proposal,” Mr Mookhey said. “Change will happen if it is clear that the public will be better off.”