International Game Technology to Develop WWE Lottery Games

It’s a lottery royal rumble, as International Game Technology (NYSE:IGT) is teaming up with the WWE (NYSE:WWE) to launch wrestling-themed lottery games.

The lottery operator and slot machine manufacturer said it signed a multi-year licensing agreement with the WWE to develop and distribute lottery games featuring WWE branding with personalities from the wrestling league and events, among others. Financial terms of the accord weren’t revealed.

IGT looks forward to melding the unique WWE assets with IGT’s lottery expertise to create appealing, high-quality games and second-chance promotional opportunities for our global customers and their players,” said IGT COO Jay Gendron in a statement.

IGT didn’t say in which states or countries the WWE lottery products will be available. But the company operates lotteries for dozens of states and nations outside the US. It’s also one of the largest providers of instant lottery and scratchers.

Themed Lottery Is Big Business

Theme lottery tickets are popular among consumers, and companies like IGT offer an assortment of such products.  Those range from scratchers with holiday themes to items drawing inspiration from classic video and board games, such as Monopoly.

The company’s portfolio of instant lottery games includes Crossword Corners, Crossword Connect, Extended Bonus Play, Lucky Sweeps and event-based second chance drawings, among others.

While the WWE isn’t a sport in the traditional sense, there’s no denying the entertainment company’s reach and devoted fan base. Unlike standard domestic sports, the WWE delivers 52 weeks of programming each year, including pay-per-view events and scheduled television programming.

The brand is also recognized on a global stage, as it reaches nearly 1 billion households and is broadcast in 28 languages.

Lottery Biz Is IGT Cash Generator

In September, IGT announced the creation of a dedicated digital and betting unit, and as noted above, the company is one of the dominant slot machine manufacturers. Some analysts believe investors shouldn’t lose sight of the company’s lucrative lottery business.

In starting coverage of IGT last month, Stifel analyst Jeffrey Stantial said the lottery business isn’t getting the credit it deserves and is under-appreciated among investors.

IGT’s lottery business remains deeply discounted relative to public and M&A comps, with several catalysts to re-rate,” he notes. “IGT looks well-positioned to compete across most high-profile growth opportunities (iGaming, sports betting, iLottery, cashless), while current valuation portrays IGT as solely a low-growth legacy provider.”

When properly managed, lottery businesses, including IGT’s, are usually profitable and can generate ample amounts of free cash flow.