(Reuters) - OPAP (OPAr.AT), Europe's biggest betting company, said on Thursday it had shortlisted three IT providers to help it expand into online betting, a business it sees as a key growth driver.

OPAP is in discussions with three gaming software companies, GTech - a unit of Italian lottery Lottomatica (LTO.MI) - Playtech (PTEC.L) and Intralot (INLr.AT), Chief Executive Yannis Spanoudakis said.

On Internet (betting), we are in the final phase to pick a vendor among three candidates, Spanoudakis told reporters. He said the company aimed to make a decision in the third quarter.

Plans to expand into online betting, a thriving grey market that Greece wants to regulate, along with video lotto terminals (VLTs) are expected to boost the value of OPAP which posted a 21 percent drop in quarterly net profit last week because of a deep recession.

Greece holds a 34 percent stake in OPAP, the country's second biggest listed firm by market value, and wants to sell most of it later this year to boost its much-delayed privatization plan and help cut its debt.

Last year, OPAP paid hundreds of millions of euros to the state to acquire an exclusive license to operate 35,000 VLTs in the country. It initially planned to start rolling out the machines by the start of the second quarter this year but regulatory delays pushed back its plans.

Spanoudakis now said that the first VLTs along with internet gambling could start by the third quarter of the year and would not help profitability much before 2013.

Shares in OPAP have gained 7 percent so far this year, underperforming a 10.6 percent rise of the Athens Stock Exchange.