PartyGaming And Bwin Talk Of Merger
8th February, 2010
Over the past 6 months the industry grapevine has been alive with talks of massive mergers between the largest online gaming companies. The most attention has been in the direction of the mooted partnership between PartyGaming and bwin when rumours began circulating back in the summer. However, the companies have firmly denied such a consolidation was on the cards, but now after a few months the pair has been forced to admit talks of a merger between the two.
News outlets and stock market investors are keeping a keen eye on this story with both companies showing strong financial credentials. At the moment, bwin has overtaken the once dominant Party Gaming in company value. With bwin worth $2.2billion in comparison to $1.8billion, bwin would certainly be the leading force in any potential partnership.
bwin chairman Hannes Androsch said, “Talks are going on but we don’t know yet whether they will succeed.” Meanwhile, PartyGaming CEO Jim Ryan has alluded to “active discussions.” PartyGaming revealed, “The board of PartyGaming confirms that it is continuing to hold discussions with a number of companies in the gaming sector regarding potential consolidation opportunities.”
With neither firm wishing to be drawn on a specific consolidation partner seems to indicate that multiple companies are being considered. “I do think there’s going to be a domino effect, meaning the first deal gets everybody else to run,” an unnamed source told Reuters.
There are many reasons why bwin and PartyGaming are such a good match, firstly being their size. Bwin has the largest market share of the European gambling market at 8%, with Party in second place at 6.3%. There isn’t a single dominant force in this lucrative gaming market and the potential power of a new super-company is enticing to executives on both sides of the table.
Furthermore, both firms make up for each other’s deficits. PartyGaming has an excellent casino player base, whilst bwin is the region’s most popular sportsbook. Where online poker is concerned, both are major players.
By Faye
