Big Business for Online Casinos

by , Aug 18, 2015 | 3:26 pm

The online poker and gambling world is changing. Business-wise, internet casino giants are shuffling the deck to position themselves for a shifting battle to dominate in the 21st century, while new players seek a foothold in the action.

One group determined to play for the top spot are 888, who have been offering sophisticated online gambling since the early days of the internet. The publicly traded parent financier 888 Holdings (888.L) have been making moves to stay in a powerful position. But buying and selling assets can be complicated in the world of international high finance and multijurisdictional regulatory oversight. In July, 888 thought they had won a bidding war to acquire longtime rival poker and casino powerhouse Bwin.Party (BPTY.L) for £900 million (US$1.4 billion). But not so fast! The rival suitor, whom 888 thought they had outbid, came back with a slightly higher offer and less corporate baggage.

Apparently, GVC Holdings (GVC.L) was hoping the third time would be a charm in their quest to land Bwin.Party assets, which include not just the poker site, but also bingo, casino, and sports betting operations. GVC made a bid in May, only to have 888 follow that with a bid of its own. GVC responded by declaring its intent to partner with Canada-based Amaya (AYA.TO), which had recently acquired poker behemoth PokerStars for US$5 billion. In June, Amaya had upped its stature by securing listing on NASDAQ stock exchange, too. And sure enough, in July, the new online gaming allies submitted a new bid to take over Bwin.Party.

(Their plan was to split the company, with poker going to Amaya, and the casino and sports-betting operation going to GVC.)

In the end, with dollars and pounds between almost identical, Bwin.Party accepted 888’s offer — for many reasons but one being the complexity of the deal with GVC and Amaya.

But GVC wouldn’t go away, and recently returned to the table saying wait-wait, they were happy to ditch Amaya — Pokerstars, Pokershmars — and offer even more money, this time £1.03 billion (US$1.6 billion). And Bwin.Party is listening once again.

Meanwhile, the banks at JP Morgan and Barclay’s that were underwriting the dual-currency leveraged loan financing between Bwin.Party and 888 have begun to scoff, saying they can’t keep their complex funding mechanism on hold indefinitely to secure a necessary financial exchange that may or may not happen. Sure, everyone wants to make as much money as possible, but eventually the auctioneer has to cut off the bidding, right? Going once, going twice …

What the 888 buyout of BwinParty, or lack thereof, will mean for players is hard to say. Short term, they can expect no changes. For the foreseeable future 888 will continue to offer the same great online action that their loyal players have become accustomed to.

Even though the ink on this deal has yet to dry, you can still enjoy all your favorite games and play 888casino at Piramind.com.


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