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London Olympics to hit revenue target

Updated: 2012-03-06 11:00
( Agencies)

LONDON - Organizers of the London Olympics are set to meet their target of raising 2 billion pounds ($3.2 billion) to help stage the Games this summer.

Revenue from sponsorship and ticket sales should top initial forecasts, putting the London Organizing Committee on course to keep its side of the Olympic bargain, LOCOG chief executive Paul Deighton told Reuters in an interview on Monday.

LOCOG will not publish final accounts until after the Games end, prompting criticism from London politicians and British media about a lack of transparency.

"I broadly expect us to break even, said Deighton, who worked for investment bank Goldman Sachs for two decades before joining LOCOG in 2006.

"One way I describe our project is trying to land about 2 billion pounds of revenues, with about 2 billion pounds of costs. We have got committed just over 92 percent of the revenues we need," he said, adding the remainder should come from ticket sales and merchandising.

LOCOG is largely privately funded, raising money from local sponsors, ticket sales and merchandising. It also gets a slice of funds raised centrally by the International Olympic Committee through global sponsorship and broadcast deals.

Britain has also put up 9.3 billion pounds public funding to prepare for the Games, most of it to build the Olympic Park, which has transformed a rundown area in London's east end.

Latest accounts showed more than 500 million pounds of public money remained available, with sports minister Hugh Robertson saying the Games should come in under budget.

However, total public spending is more than double the forecast when Britain was awarded the Games in 2005.

Britons looking for value for money from Games

Sponsorship deals for the London Games have raised 700 million pounds, a performance Deighton said was "gravity-defying" when the economy had been struggling for growth.

Ticket revenues were expected to top 600 million pounds - above an initial forecast for something above 400 million.

Demand for tickets for the July 27- Aug 12 Games outstripped supply in many events, leaving many Britons frustrated at not being able to get a seat.

Deighton said skeptical Britons needed "warming up" ahead of the Games which are taking place at a time of heavy state spending cuts and rising unemployment.

He said while 75 pence in each pound of public spending had gone on facilities that would leave a lasting legacy after the Games, Britons needed convincing the Olympics were worth it.

"People accept it is going to be a great party in the summer. But they also want to make sure, particularly in this environment, that it is decent value for money," he said. "I think there is still work to be done to get that effectively across."

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