Bwin.Party Online Casino Said to Weigh Possible SaleChristopher Palmeri
Bwin.Party Digital Entertainment Plc, a pioneer of online gambling, is considering selling some or all of the company as part of a strategic review, two people with knowledge of the matter said.
The Gibraltar-based company, a partner in New Jersey’s new online betting market with Borgata Hotel Casino & Spa, hired Deutsche Bank AG to consider its options, said the people, who requested anonymity because the matter isn’t public. The company will decide within two months, one person said. In a statement today, Bwin said it has no plans to break up or sell the company.
The discussions follow a share drop, a change in board leadership and a disappointing start to online betting in the U.S. A new threat emerged this month when PokerStars, the world’s dominant poker website, agreed to be sold in a deal that could hasten its re-entry to the fledgling U.S. market after an absence of several years.
Bwin shares rose 4.1 percent to 96.40 pence at 9:38 a.m. in London, paring earlier gains of as much as 11 percent. The company has a market value of 790 million pounds ($1.3 billion). The stock had declined 25 percent this year before today.
The company appointed a new chairman, Philip Yea, in April, and settled a proxy fight for board seats with SpringOwl Asset Management LLC, led by former casino analyst Jason Ader. Bwin named one of his representatives, Daniel Silvers, as a director last month, as part of changes that included the planned retirement of three board members.
Bwin Chief Financial Officer Martin Weigold said on a March conference call that the company faced a difficult year in 2013, including a decline in sales due to regulatory and competitive challenges in a number of markets. He said the company was looking to divest non-core and surplus assets.
The parent of PokerStars, Rational Group Ltd., agreed this month to be acquired for $4.9 billion by Amaya Gaming Group Inc., a supplier of betting equipment and systems based in suburban Montreal.
Amaya plans to bring PokerStars back to the U.S. following run-ins the site’s former management had with authorities. That could accelerate the wobbly start for online betting in three states, while introducing more competition for Bwin and others for those gamblers.
Borgata, Bwin’s casino partner in online betting in New Jersey, is owned by Boyd Gaming Corp. and MGM Resorts International. The partners have emerged as the leader in online betting in the state, with almost a 40 percent share of the $10.5 million in May proceeds, according to a state report. Online betting is also legal in Nevada and Delaware.
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.