Poker News

Shareholders of Party Gaming and bwin Interactive Entertainment voted on Friday to approve the merger of their two companies, forming the largest online gaming business in the world. The new company will operate with its existing brands under the name Digital Entertainment plc in which current bwin shareholders will hold a 51.6% stake, while current Party Gaming shareholders will hold 48.4%. The company’s change of name will be registered when and if the court order sanctioning the merger takes effect, which is anticipated to happen on March 31st.

Party Gaming and bwin first announced their intention to merge back in July. The companies then issued a 478-page document to shareholders in December giving a detailed outline of the planned merger. Shareholders voted on the merger at an extraordinary general meeting (EGM) Friday morning, where bwin shareholders unanimously approved of all five resolutions relating to the merger. A total of 335 shareholders attended bwin’s EGM, representing 18.1 million shares.

At Party Gaming’s EGM held in Gibraltar Friday afternoon, 99.4% of the shareholders approved of all nine resolutions relating to the approval of the merger, including the change of name from PartyGaming Plc to Digital Entertainment plc. With the approval of the merger completed, all shareholders holding bwin stock will receive 12.23 Party Gaming shares denominated in GBP for each bwin share.

The new group will be listed on the London Stock Exchange and jointly run by the current Chief Executives of the two companies, Jim Ryan (Party Gaming) and Norbert Teufelberger (bwin). Party Gaming will keep its main headquarters in Gibraltar, while bwin will continue to operate from Austria.

Commenting on the results of Friday’s EGMs, Ryan and Teufelberger said, “Today’s shareholder meetings were a key milestone in the overall process, putting the transformational merger of our two companies well on the way to completion. We are delighted that both sets of shareholders have overwhelmingly recognized the strategic, operational, and financial benefits of creating the world’s largest listed online gaming company.”

According to Party Gaming’s shareholder prospectus, the merger will create a business with unaudited net revenues of €696.2 million, unaudited clean EBITDA of €193.7 million, unaudited profit after tax of €99.4 million, and unaudited net assets of €1.27 billion after consolidation adjustments.

The newly merged company will continue to focus on business-to-consumer products, an area in which it enjoys considerable strength. However, because of the financial gains added through the merger, the company will also encroach into business-to-business and business-to-government endeavors. Teufelberger explained, “Our many years of online know-how, healthy balance sheet, and one of the largest pools of poker liquidity in any regulated market will make us an attractive business partner.”

Said Ryan, “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, the enlarged group will have a winning formula to exploit the growing online gaming market, supported by a strong balance sheet, significant cash flow generation, and a highly experienced management team.”

The merger news comes just a week after bwin announced the launch of the first real money online poker application for the iPhone. The new application, listed as “ Poker” in the Apple store, follows the company’s sports betting application that found a home on the Apple device last year. A PartyPoker app for the iPhone is expected to follow.

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