Frankfurt XETRA listed European lottery broker ZEAL Network SE (formerly MyLotto24) has announced that it will write down its venture investment in UK lottery games operator Geonomics Ltd.
Updating the market, ZEAL governance detailed that it had reviewed Geonomics growth viability and concluded that it could no longer support its investment in the business.
ZEAL’s write down will see the company attach a non-cash impairment charge of circa €19 million for its fiscal 2015 corporate income statement.
Founded in 2010 by brothers James (CEO) and Henry Oakes (Commercial Director), Geonomics a location based lottery had branded itself as the “lottery game for the Facebook Generation”.
In June 2015 following weak growth projections of Geonomics products, Canadian provisional lottery operator Atlantic Lottery Corporation (ALC) a principal investor in Geonomics declared that it would write down its $8.6 million investment in the venture.
An independent review of the ALC’s investment criticised the operator’s governance stating that it misused state funds in order to invest in an unproven commercial model run by recent business graduates.
Issuing a short statement, Zeal alerted investors that the write down would affect its full-year 2015 earnings, which will be published shortly.