Amaya Gaming Group has sealed the deal with bwin.party to take the Ongame Network off their hands. Announced first thing this morning, it could cost Amaya as much as €25 million to acquire the poker network with almost half the amount contingent on US online gaming regulation taking place within the next five years.
Commenting on the deal, David Baazov, CEO of Amaya Gaming, said: “The acquisition of Ongame bolsters Amaya Gaming’s product portfolio, transforming Amaya into a leading provider of gaming platforms. Amaya looks forward to unleashing Ongame’s technology to its full potential through the leveraging of our many B2B relationships and delivering new partners and players to the network. The Ongame platform is scalable, proven and secure and is well suited for quick deployment in new regulated markets. We’re excited about the wide range of opportunities this acquisition makes possible for us as we execute on our vision.”
The deal itself is for €15m cash up front and as we mentioned earlier the additional €10m depends on regulation in one of the “new markets” Baazov alludes to – the United States. Those of you familiar with the Ongame sale process will know it represents only a small amount less than Shuffle Master was willing to pay earlier this year, which was a similarly structured deal worth a total of €29.5m – again €10m of which was payable on US regulation within five years.
Bwin originally bought the network in 2006 for €475m, now a hugely inflated figure even if you take into account the time that has passed. Since then Bwin merged with Party Gaming to form what is now one of the largest iGaming firms on the planet. Co-CEOs Norbert Teufelberger and Jim Ryan were understandably pleased at being able to broker the deal.
“The sale of Ongame conforms to our strategy, especially as we move closer to launching our single, proprietary technology platform in the next few months. We believe Ongame will fit well into Amaya Gaming and has an excellent future ahead,” Teufelberger and Ryan said.
The purchase gives Amaya Gaming quite the arsenal when put with their Cryptologic casino platform. In that sense the deal looks like working out well for both sides – even if the financial loss for bwin.party is a huge one.