On Thursday, Bwin.party released a statement confirming that it had received a proposal from GVC to acquire Bwin.party’s total share capital. Bwin.party said its board had “determined to work with GVC so that they can finalize their offer over the coming days.”
As previously rumored, GVC’s cash-and-shares offer values Bwin.party at 110p per share, a roughly 10p premium on Wednesday’s closing price (but a significant haircut from what the combined value of Bwin and PartyGaming was at the time of their ill-fated 2011 merger). More than half (55%) of the roughly £900m total deal price would be in new GVC shares.
GVC issued its own announcement confirming the bid. GVC CEO Kenneth Alexander (pictured) said his company’s 2013 acquisition of Sportingbet’s grey market assets led it to believe a Bwin.party deal would provide “substantial financial and operating synergies and represent an excellent opportunity for both GVC and bwin.party shareholders.”
Neither announcement made mention of GVC’s takeover partner Amaya Gaming, but it’s understood that GVC would assume control of Bwin.party’s flagship sports betting business, while Amaya would get the casino and PartyPoker business. Alexander subsequently told eGaming Review that Amaya would be a “significant partner” in the deal.
Both GVC and Bwin.party cautioned that there was no guarantee that a deal would be forthcoming but Alexander told the Financial Times that “the big points have been agreed” to and he “would be staggered” if the deal wasn’t consummated. It remains to be seen whether rival bidder 888 Holdings would come back to the bargaining table with its own revised bid but Alexander believes GVC/Amaya’s offer would realize “far greater synergies than 888.”
BWIN.PARTY H1 “IN-LINE WITH OUR EXPECTATIONS”
Meanwhile, Bwin.party also released a trading update on its H1 2015 performance. Final numbers won’t be released until Aug. 28, but Bwin.party CEO Norbert Teufelberger claimed to be “pleased” with his company’s performance “despite challenging comparatives” and the impact of the European Union’s new Value Added Tax on online services and the UK’s new online point-of-consumption tax.
Bwin.party said sports betting turnover was “ahead of last year” despite 2014 being a FIFA World Cup summer. However, sports bet margins were “below normalized levels,” resulting in revenue “holding back.” Casino turnover “remained strong” and the underperforming poker vertical was “closing the gap on last year.” Mobile/touch gaming revenue in the month of June improved to 31% of the total, up from 23%, while mobile sports betting rose to 50% from 37%.