Breaking News: PartyGaming and Bwin to merge 29/07/2010
PartyGaming and Bwin will merge to create the world’s largest listed egaming company, the firms announced to the London Stock Exchange (LSE) this morning.
The alliance will see Bwin become the majority shareholder with 51.64% of the newly merged business, while PartyGaming will own the remaining 48.36%. The company will be listed on the LSE. Bwin is currently the largest publicly listed egaming company with a market cap of around €1.4bn, while PartyGaming is second with a market cap of £1.1bn.
The merged company will have pro-forma 2009 net gaming revenue of €682m (£571m) and earnings before interest, tax, depreciation and amortisation of €196m.
PartyGaming’s and Bwin’s share prices both rose following the announcement. PartyGaming shares climbed 30 per cent to 333p while bwin shares were up 12 per cent to €39.90.
Jim Ryan, chief executive of PartyGaming, and Norbert Teufelberger, co-chief executive of Bwin, will become co-chief executives of the merged company. Current Bwin co-chief executive Manfred Bodner will become a non-executive director on the board of the enlarged group.
There will be a balanced management structure for the merged company, with equal representation from PartyGaming and Bwin. Martin Weigold of PartyGaming will become the new merged company’s group finance director, while Joachim Baca of Bwin will become its chief operating officer.
Ryan said: “This is a transformational opportunity for both our companies to create the world's largest listed online gaming business. With market-leading positions in poker, sports betting, casino and games (in particular bingo), the enlarged group will have a winning formula to exploit the growing online gaming market, supported by a strong balance sheet, significant cashflow generation and a highly experienced management team.”
A merger between the two publically listed companies has long been rumoured. During PartyGaming’s strong fourth quarter results announcement in March, “active discussions” between the two companies were reported.
The merged company will continue to be based in Gibraltar. Upon the completion of the merger, which is expected to be in the first quarter of 2011, Bwin shares will be de-listed from the Vienna Stock Exchange and the shares in the combined entity will be listed on the LSE.
The deal has the backing of 28.5% of PartyGaming shareholders – founder shareholders Ruth Parasol and Russ DeLeon and CEO Jim Ryan – and 14.4 per cent of bwin’s existing share capital.
Don't miss out on egaming news: sign up for our free, daily Snapshot email. Or get the news as its breaks with the free eGaming Review RSS feed.
Posted: 29/07/2010
User comments
Anonymous
Interesting to see what they do with the poker business. Party software is much better than OnGame....interesting times ahead
Anonymous
They will probably stay with PartyPoker brand... in this case Ongame will loose around 20% of liquidity - true ?
Usernamed
So does that mean the new entity is entitled to 48.36% of a US License!?
Anonymous
What does thie mean for the rest of us?!?! William Hill, Ladbrokes.....
Usernamed
...it means they will spend the next year integrating everything and not marketing themselves. Then the (enormous) egos will start to fall out with each other. It's going to be great fun. Sit back and enjoy!
Anonymous
BWin are a lot more than 20% of ongame. I think it's more like 60%, no?
Michael Lampel from Highraker.net
I expect that they leave both poker brands as they are but sharing promotions and player databases.
Anonymous
"What does this mean for the rest of us?!?! William Hill, Ladbrokes....."
They'll either kick your ass or dissolve into internal politics and arguments over who gets the corner office. Bwin have some nice new sportsbook product coming soon.
They are so big the only way to compete will be to get big so maybe merger mania will finally kick off...
Anonymous
Whatever, can't figure out how to grow buy something, feel good for awhile, blah blah blah.
The biggest in "listed" + No. 3 Poker = Still # 3 Poker site & still the same whatever.
Anonymous
Guys, stop griping and moaning. It is great news for our sector unless you are worried that you are not competent enough to compete. The companies that have a solid business will continue to outperform and those who don't will continue to fall back. Bwin/Party will have economies of scale, but innovation will be on the side of the faster and smaller players.
This merger should mean that the financial markets will take notice of our little sector and start to think about investment opportunities. I have noticed an increasing amount of VC and PE guys hanging around EIG and GES. When the VC and PE guys take notice of our sector M&A activity might just kick off, which is great for shareholders (more buyers = better valuations). Our sector has been depressed lately and this merger might just be the kick start we need.
Anonymous
"but innovation will be on the side of the faster and smaller players."
Can't agree with this. As new markets open, they will need the strength and resources to address them, and small players won't be able to capitalize. Size matters!
egrjobs.com
Web & Customer Services Operator – Croatian
Ladbrokes , UK
Web & Customer Services Operator – Spanish
Ladbrokes , UK
CRM & Database Analyst
EsandaRecruitment.com , Mainland Europe
Head of Business Intelligence (Business Objects)
EsandaRecruitment.com , Mainland Europe
Senior CRM Campaign Executive
Ladbrokes , UK
Bob
888 will be the next one to join them...
Trust me
» Report this comment