Amaya And GVC Look To Trump 888 Holdings With Bwin.party Acquisition Bid

May 18th, 2015 | by Greg Shaun
bwinparty

Bwin.party will be split in two should it accept a surprise bid from Amaya and GVC. (Image: bwin.party.com)

Bwin.party’s future today became the subject of a high-powered bidding war between two giants of online gaming.

In one corner is 888 Holdings, which announced on Monday morning that it had submitted a proposal to acquire bwin.party in its entirety in a cash and paper bid.

In the other corner is a joint €1.5 billion ($1.7 billion) offer from Amaya Inc and GVC Holdings, which would ultimately break the company in two.

The acquisition talks, which have been ongoing since the summer with little reported developments, suddenly escalated last Friday, when GVC tabled its initial bid.

The amount was undisclosed, but GVC, which owns Sportingbet, said that it would be a reverse acquisition, with bwin.party’s market value estimated to be twice that of GVC.

888 Statement

888 Holdings made its move on Monday morning with another undisclosed bid. “The Board believes that there is significant industrial logic in a combination of 888 and bwin.party, benefiting both companies and all shareholders and accordingly, has submitted a proposal regarding the acquisition of the entire issued and to be issued share capital of bwin.party for consideration comprising cash and 888 shares,” read a statement from 888 Holdings.

“Due to the size of the proposed transaction, it would require, inter alia, the approval of 888 shareholders. 888 shareholders representing approximately 59 percent of 888’s share capital have irrevocably committed, subject to customary conditions, to vote in favour of the proposed transaction.”

€1.5 billion Counter-bid

Just hours later, a counter bid of €1.5 billion was tabled by Amaya and GVC. The two companies have fleshed out a deal that would create a vehicle for the acquisition and would allow GVC to own the majority.

Amaya, meanwhile, would then purchase the poker operations, and two years later, once GVC had restructured the rest of bwin.party’s assets, Amaya would have an option to buy the sportsbook. 

Amaya’s acquisition of bwin.party’s poker assets would grow its dominance of not just of online poker but live poker too: bwin.party’s WPT and PokerStars’ EPT would both be owned by the same parent company.

The deal has echoes of GVC’s 2012 acquisition of Sportingbet, for which it teamed up with William Hill. Under the terms of that deal, William Hill acquired Sportingbet’s Australian and Spanish operations, while GVC absorbed much of the online sportsbook’s gray market operations.

As bwin.party is highly engaged with many gray markets, with roughly half its revenue coming from these markets, it’s possible that something similar may be planned should this deal go through.

“The board and its advisers are conducting a detailed review of the proposals received to-date and will make a further announcement in due course, however there can be no certainty that these proposals will result in a transaction being completed,” said bwin.party in a statement following the bid announcement from 888 Holdings this morning.

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