Party Gaming Takes the Plunge with Bwin

Written by Matt W | Friday, July 30th, 2010

Hailing the move a “transformational opportunity”, and after many long months of negotiations, speculation and rumors, Party Gaming finally took the plunge and revealed concrete plans to merge with Bwin Interactive Entertainment. Gambling analysts predict that the move will create one of the biggest giants the industry has ever seen, with a joint value of $3.7 billion.

Party Gaming, which for many years stood at the forefront of the US online poker industry until it was forced from the market by the Unlawful Internet Gambling Enforcement Act of 2006, will essentially face a reverse takeover by Bwin, and 51.6% of its shares will be owned by the Austrian company. Bwin investors will receive 12.23 new Party Gaming shares for each share that they own.

The newly merged company will be run jointly by the Chief Executive of Party Gaming, Jim Ryan and the CEO of Bwin, Norbert Teufelberger as co-chief executives.

Naturally, shares in both companies reacted well to the news, with Party Gaming shares climbing 20.4%.

Party Gaming signed a settlement deal with the Department of Justice over its former gambling activities in the United States, one of the only companies to do so on a formal level. The news that Barney Frank’s HR 2267 to repeal the controversial UIGEA passed through the US House Committee on Financial Services on the very day that Bwin and Party Gaming signed their merger intentions was seen as a good sign across the board.

According to Jim Ryan, the United States is the “holy grail”.

Bwin has often spoken about the huge benefits there are to be had in a regulated US gambling market and these calls have been heard more frequently in recent weeks.

Party Gaming Takes the Plunge with Bwin

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