Breaking News: PartyGaming and Bwin to merge
Merger will create world's largest egaming listed firm " Ryan and Teufelberger become co-chief executives of "enlarged group"
PartyGaming and Bwin will merge to create the world’s largest listed egaming company, the firms announced to the London Stock Exchange (LSE) this morning.
The alliance will see Bwin become the majority shareholder with 51.64% of the newly merged business, while PartyGaming will own the remaining 48.36%. The company will be listed on the LSE. Bwin is currently the largest publicly listed egaming company with a market cap of around 1.4bn, while PartyGaming is second with a market cap of £1.1bn.
The merged company will have pro-forma 2009 net gaming revenue of 682m (£571m) and earnings before interest, tax, depreciation and amortisation of 196m.
PartyGaming’s and Bwin’s share prices both rose following the announcement. PartyGaming shares climbed 30 per cent to 333p while bwin shares were up 12 per cent to 39.90.
Jim Ryan, chief executive of PartyGaming, and Norbert Teufelberger, co-chief executive of Bwin, will become co-chief executives of the merged company. Current Bwin co-chief executive Manfred Bodner will become a non-executive director on the board of the enlarged group.
There will be a balanced management structure for the merged company, with equal representation from PartyGaming and Bwin. Martin Weigold of PartyGaming will become the new merged company’s group finance director, while Joachim Baca of Bwin will become its chief operating officer.
Ryan said:”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 (in particular bingo), the enlarged group will have a winning formula to exploit the growing online gaming market, supported by a strong balance sheet, significant cashflow generation and a highly experienced management team.”
Teufelberger said: “This merger of equals makes great strategic, operational and financial sense. We will be in pole position to capitalise on the wealth of opportunities that will flow from the continued evolution and expansion of the global online gaming industry.”
A merger between the two publically listed companies has long been rumoured. During PartyGaming’s strong fourth quarter results announcement in March, “active discussions” between the two companies were reported.
The merged company will continue to be based in Gibraltar. Upon the completion of the merger, which is expected to be in the first quarter of 2011, Bwin shares will be de-listed from the Vienna Stock Exchange and the shares in the combined entity will be listed on the LSE.
The deal has the backing of 28.5% of PartyGaming shareholders “ founder shareholders Ruth Parasol and Russ DeLeon and CEO Jim Ryan “ and 14.4 per cent of bwin’s existing share capital.