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Could Finnish Government Sell Veikkaus Ahead of Open Gambling Market?
The new Finnish open market iGaming sector is set to open on July 1, and the licensing pre-application phase is running at full speed. While no official license applications have been confirmed just yet, there are many big names in the running including Betsson, Kindred Group (Unibet), as well as the conglomerates Entain (Bwin, PartyPoker), and Flutter (PokerStars, Betfair) all in the mix. Finland is poised to become one of the largest iGaming markets in Northern Europe, but questions remain around the future of Veikkaus, the history state-run firm that has held the gambling monopoly since 1940.
The Finnish lottery, sports and casino games provider Veikkaus has restructured its business model ever since the decision to open the market was made public. They have been carefully brokering partnerships with iGaming developers, branching out into new verticals, and even launched their own in-house gaming studio, Fennica, in preparation of the big change. However, there are questions about what will happen to the ownership of the company, as some MPs in the government have stated it is no longer in their interest to run such a firm.
Will Veikkaus be sold? There is a lot of speculation and political division over what will happen next for Veikkaus.
Hypothetical Veikkaus Sale Issues
The future of Veikkaus is really a political issue, as this longstanding gambling firm is government owned and controlled the gambling scene for decades on end. In its current form, Veikkaus is only 8 years old, as it was a merger of the Fintoto, Finland’s Slot Machine Association, and Veikkaus. The company owns lottery products, landbased gaming stations, including a casino in Helsinki, online sports betting and online casino games. When the Finnish new iGaming market opens, on July 1, the question is whether or not the government should continue to run the company in the new liberalized market.
Because this would raise antitrust issues for a start. The gambling sector in Finland would be open to private firms and international companies, but the government would still own Veikkaus, which has all the already existing infrastructure and reputation to ideally keep a majority share of the market. How can new firms, even those like Flutter or Entain with global brands, compete with a firm that has such strong and deep roots in the Finnish gambling market?
Then, there is the issue of revenue. Because the Finnish Government could make tremendous revenue from the gambling proceeds through its own state-run firm, but if it were to give it up, then the only revenue would come through the taxation of international firms and the new owners of Veikkaus. And finally, the last aspect to consider is the debate around state intervention on gambling addiction and safer responsible gambling messages. With an open market, the state will have to rethink its strategy, which was so much easier when they were the one running the solitary gambling firm in the country.
Under new ownership, they would be losing all their access to how Veikkaus tackles responsible gambling, and with it there are concerns this could result in a loss of control on how safer gambling is maintained in Finland.
Where the Politicans Stand on Veikkaus
Politicians are divided on the matter. Opposition parties SGP and the Centre Party have publicly expressed that Veikkaus should no longer remain in the hands of the state. The state should no longer have a strategic interest in owning a gaming company, they said, and one political party pushed for the full privatization of Veikkaus, selling off the asset. But the parties in Government don’t necessarily share those ideas. The National Coalition Party, Swedish People’s Party, Finns Party and Christian Democrats all kept deliberately coy on the subject matter.
Veikkaus will not be dismantled following the opening of the Finnish iGaming sector. It will continue to operate as it did, only now with competition from private operators who obtain iGaming licenses. So as the noise around potentially selling it gets louder, and the Government still doesn’t take a side, the situation is naturally attracting a lot of attention. So much so, that there has already been some real commercial interest in buying Veikkaus.
How Much Veikkaus Could Cost
The valuation of Veikkaus is not a straightforward task, because it depends on whether the Finnish government decides to sell it partially into private ownership, fully privatize it, or decide to hold onto it. Though a senior executive at Veikkaus, Jari Vähänen, stated that a few companies have already reached out to Veikkaus about a potential sale. Vähänen gave an estimate of up to €4.5 billion, basing it on the annual gaming surplus of the company (€450 million) and multiplying it by 10. Further broken down, this would come to about:
- €1 – €1.5 billion for the online and sports betting verticals
- ~€3 billion for the lottery products and gaming machines
He stated that the value of Veikkaus has slowly declined, with their financial returns nearly halving over the space of the last 5 years. Though the company has a strong standing with Finnish gamers, and a customer base that is estimated to be around 2.5 million. If they can retain those customers and hit the ground running in the new licensed iGaming market, then they could very well dominate the market for years to come.
Veikkaus’ Quiet Restructuring and Expansions
The draft of the New Finnish Gambling Act in 2024 was really the beginning of the end for the gambling monopoly. While it didn’t break the Veikkaus monopoly straightaway – we are still waiting for that to happen nearly 2 years on – it hit Veikkaus pretty hard. The countdown began, but Veikkaus did not sit idly by. Instead, the company started to form new partnerships and deals for more games, as well as expand on its own iGaming developer studio.
The expansions and deals on the side include:
- 2026
- Fennica Gaming expands into Germany, Czechia and Mexico
- 2025
- Veikkaus partners with Blueprint Gaming and Hacksaw Gaming
- Veikkaus extends Liiga sports sponsorship
- Helsinki-areena rebrand (Veikkaus Arena)
- Fennica Gaming expands into Quebec, the UAE, Greece, Ontario, Slovenia, and Belgium
- 2024
Its Place in the New Finnish iGaming Market
There have been some insiders who claim Veikkaus took advantage of those final 2 years as a gambling monopoly, using it to seize as many iGaming software partnerships and expansion as possible.
This would just raise the standard for Finnish gamers, who, by the time of the launch of the new iGaming sector, would require newly joining operators to start big to continue enjoying the same perks as what Veikkaus has established as the new Finnish iGaming industry standard.
There are many examples of former gambling monopoly countries that opened their markets, but the old state-run firms managed to retain their position as the majority holder in the market. For instance, Svenska Spel is still arguably the biggest gambling firm in Sweden despite the market opening back in 2019 and big competition like bet365, Kindred and Unibet entering the picture.
In Italy, the ADM-linked operator still holds a strong market share, though the gap is starting to narrow as Flutter chases Lottomatica and the new Italian iGaming reforms have cleaned up the scene of any skin sites and dodgy third party operators. Another example is Stoiximann in Greece. So once again, there are precedents that would encourage Veikkaus in its plight to hold onto as much of the market as possible. But a sale or restructuring of the operations could throw some of that into jeopardy and break the momentum they have been carefully building up to this point.
What Happens Next for Veikkaus
The decision rests entirely in the hands of the Finnish Government. While most countries that launch open gambling markets or legalize online casinos tend to create new gambling authorities as well to regulate them, Finland is going to use the existing state regulators. There will be some structural changes, but for the time being the Ministry of the Interior is responsible for the gambling legislation and policy directions, and the National Police Board of Finland is responsible for enforcing these laws.
Having a state-run gambling firm can definitely bring up some conflict of interests here, and there are sound claims that holding onto Veikkaus may cause trust issues or even question the competitiveness of Finland’s new open market. But this is not a decision that should be taken lightly, especially considering the huge revenue that Veikkaus has brought the state. Whatever happens, change is coming for Veikkaus and the firm will need to use its influence and already reinforced products to get a flying start. No confirmed rivals have gotten licenses yet, but it is only a matter of time before Flutter, Entain, Kindred, and other big groups lock Finland into their sights and jump into what could be a massive market in Europe.
