POKER

PCG Entertainment Looking to Break into the Chinese Online Poker Market

TAGs: Alternative Investment Market, China, initial public offering, Lee Davy, PGC Entertainment

PCG Entertainment are looking for an Alternative Investment Market Initial Public Offering to act as the springboard for their entry into the huge online gambling market of the People’s Republic of China.

PCG Entertainment Looking to Break into the Chinese Online Poker Market Gibraltar incorporated holding company, PCG Entertainment, can expect to start trading on the Alternative Investment Market (AIM), in London, on 4 Dec 2014, after raising £3.41m in new capital. The company is now valued at £61.8m.

The Initial Public Offering (IPO) is part of a plan to break into the online gambling market of the People’s Republic of China (PRC). When you consider the country has a population of over 1.3 billion gambling crazies, one imagines there is a pretty penny to be made.

PCG is active in the PRC market through their subsidiary Sihai Geju, and they hold four licenses relating to the operation of online gambling, and media distribution in the PRC. Once PCG launches on AIM they will then get to work seeking governmental approval to use their licenses through two Hainanese firms: Hainan Huan’ao Culture Media (HPC), and Hainan Huan’ao Sports Industry (HLC).

HPC is seen as the route to online poker. It currently sponsors the China Hainan Texas Hold’em tournament in the Hainan Province. The HLC is licensed by the Hainan Sports Lottery Management Centre and runs stores in Hainan that sell sports lottery goods and virtual games. PCG Entertainment also intend to use the two firms as a way of breaking into the premium rate telephone business, and virtual currencies. PCG Entertainment has an option to acquire 10% of both companies and will exercise that right as soon as the float occurs.

Speaking to The Daily Express, PCGE CEO, Nick Bryant said: “There’s a great opportunity for PCGE to enable HPC and HLC to expand their operations online. We have also identified opportunities to distribute new broadcast events, games and promotions in the Chinese market which we plan to implement over the next 18 months.”

Bryant also mentioned that £164 billion a year is spent by members of the PRC in both offshore gaming sites, and illegal onshore gaming sites. PCG Entertainment will be hoping that the PRC government will want that money staying within their own economy.

“By expanding legalized onshore gaming and encouraging participation in state-run lotteries, the Chinese authorities are attempting to redirect this money into a legitimate, regulated and taxable environment. This, we believe, will give PCGE a considerable tailwind.” Said Bryant.

Whilst the company was preparing for its IPO they drafted the former KPMG partner, Clive Hyman, to act as PCG Entertainment’s Chief Finance Officer.

“We’re delighted to have on board a big hitter like Clive. He is a huge asset to the operations of PCGE and his consummate governance experience brings further strong guidance to our team.” Said Bryant at the time of his appointment.

Both the World Poker Tour, and PokerStars, have held very successful live poker tournaments in the Hainan province.

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