Tabcorp has agreed to pay $600 million, plus a further $30 million annually over 19 years, taking the total payment to $1.2 billion to continue its exclusive licence for the next 20 years to provide in venue retail wagering in Victorian pubs.

Victoria is a major market as it hosts several high-profile racing events, including the Melbourne Cup, and has been a target for Sportsbet and Entain, which operates the Ladbrokes brand. The companies had earlier made proposals to be given part of the state’s wagering license, reports Australian Financial Review.

Tabcorp Chief Executive Adam Rytenskild pointed out that the company was halfway through a restructure which began with the demerger of The Lottery Corporation last year. “Before we demerged, we did not have any level playing fields, and now we have four,” he said, referring to Victoria, Queensland, Tasmania and the ACT.

“Victoria is the best license in the country, and it is the prototype for the rest of the country.”

Rytenskild said Tabcorp had “stabilized market share, digital share, and we want to grow it”. “We are competing better than we ever have,” he added.

Earlier in October, Tabcorp warned of soft trading conditions and noted that the revenues had fallen 6.1 percent in three months. Wagering turnover was also down 0.9 percent in that period.

“It has stabilized somewhat, and Spring Carnival was actually quite good,” Rytenskild said. “The main focus is how we are competing in whatever the market is and ultimately looking to take share and grow the market. Cycles come and go, and the announcement [of the new Victorian license] is much bigger than just six months of a soft market.”

Tabcorp’s previous deal with Victoria took place in 2011 with an upfront fee of AUD 410 million. The company currently does not require a fee as part of a joint venture with the racing industry and has agreed to pay $15 million in transition funding over three years.