Shares in Paypoint (LON:PAY) soared by nearly 24.5% to 328p this morning on an announcement that the National Lottery Commission had provisionally rejected a plan by lottery operator Camelot to offer ancillary activities, including mobile top ups, bill payments and other services, through its terminals.
PayPoint is a major cash and internet payments company in the UK, with operations also in Ireland and Romania. It handles over £9.3bn from almost 550 million transactions annually for more than 6,000 clients and merchants. The company’s own branded PayPoint retail network boasts over 22,300 terminals in local shops including Co-op, Spar, McColls, Costcutter, Sainsbury's Local, One Stop, Londis and thousands of independents. The terminals typically process gas and electricity meter prepayments, cash bill payments, mobile phone top-ups, transport tickets, BBC TV licences and a wide variety of other payment types for most leading utilities, telecommunications suppliers and many consumer service companies;
Responding to today’s announcement, Dominic Taylor, PayPoint’s chief executive, said: “This is a victory for local shops, including sub-post offices, whose earnings and footfall would be undermined by this proposal. Today's decision should protect vulnerable people from the increased temptation to gamble. It would be entirely wrong if Camelot were to be allowed to exploit its monopoly position, and we are pleased that the National Lottery Commission has accepted the compelling arguments that the proposal would have distorted competition in the bill payments sector.”
In a statement, Camelot said: “We firmly believe that the National Lottery Commission’s preliminary position is flawed and remain absolutely confident that our proposals do not breach either European or Competition Law. We are disappointed that the NLC has failed to reach a definitive decision – instead choosing to further extend the process, which will delay the generation of additional funds for good causes, and benefits for retailers and consumers. We remain convinced that our detailed and carefully-considered plans, based on thorough and robust legal advice, should allow us to offer commercial services through National Lottery retailers. We are carefully considering all of our options.”
Last week, PayPoint plc confirmed that trading in the first three months of the current year had been in line with the company’s expectations.
