PartyGaming and Bwin set to join forces
BRITAIN’S PartyGaming and Austria’s bwin unveiled a deal yesterday to create a £2.1bn online gaming business, positioning them to profit from any forthcoming deregulation in the lucrative US market.
The deal to create the world’s biggest listed online gaming company could kickstart a flurry of M&A activity in a fragmented sector that is seen as ripe for consolidation because of opportunities created by the relaxation of gambling laws around the world, according to analysts.
Moves in the United States to overturn 2007 legislation that effectively outlawed the industry gained momentum when the House Financial Services Committee voted to approve a bill which would legalise and regulate Internet gambling in the country.
“We’re very excited about the US opportunity,” PartyGaming chief executive Jim Ryan said.“It’s tough to quantify it until we actually see the form of legislation, but there was a very positive step made,” he added.
Under the terms of the deal, classified as a reverse takeover of bwin by PartyGaming under UK rules, bwin shareholders will get 12.23 new PartyGaming shares for each bwin share, giving them 51.6 per cent of the new company. The new group will be listed on the London Stock Exchange and jointly run by the chief executives of the companies.